A good number of our new clients decide to approach us for help with their tax affairs after receiving penalties form HMRC
I guess it makes sense as it’s easy in our busy lives to leave things until another day if they don’t benefit us in our day to day lives. When paying the accountant’s fee amounts to more or less same figure as the late filing penalty it becomes a no-brainer. Some people work this one out quicker than others: the costs of un-submitted returns and late tax payments can mount up to very significant sums. It certainly pays to act sooner rather than later.
However, believe it or not HMRC is currently considering whether or not penalties should be imposed where genuine errors occur, or where the failure of the taxpayer to meet a deadline is uncharacteristic because they are otherwise usually compliant
The reason? Well research suggests that seemingly unfair penalties have the opposite effect to the one intended. Human nature sometimes causes us to demonstrate an attitude of defiance; a determination to fight back when we believe that we’re being treated inappropriately and unfairly. My mother always said that saying please and thank you were important. Perhaps the people at HMRC are finally realising that good manners and respect for others have a place in the world of tax administration.
Of course, it won’t mean the end of penalties for those of you who deliberately or persistently fail to meet tax deadlines
However, for the good and conscientious out there it may well mean that the odd mistake is dealt with by a courteous reminder rather than an unpleasant payment demand.
If you’d like the team to help get your tax return in on time in future then don’t hesitate to get in touch!