Saturday, 16 January 2010

Sneaky fuckers!

I just had a phone call from a very good mate of mine, gabbling on about some good news he'd just received from the tax man: apparently, he no longer has to submit a tax return, which, I think we'd all agree, sounds rather fine. Imagine laughing at the drones who still have to submit their returns every year, not having to stress about it and gather the documents and so on and so forth. It all sounds rather lovely.

It sounds a bit too good to be true, and there are a string of conditions attached to it that mean that you pretty much have to do a self-assessment anyway, just to make sure you haven't broken one of the 50 or so conditions that mean you have to submit it anyway.

But then I asked him how accurate his PAYE had been for the last couple of years and the truth came out. For the last five years or so, his PAYE has consistently taken too much tax - not a lot, never more than £1500 and as little as £100 one year. But having spent no more than an hour on my tax return this year, including a call to HMRC to clarify something, I reckon that even £100 for an hour's work is worth having, let along £1500!

So it looks to me very much like HMRC are planning on shutting down on people who regularly claim tax back, all the while making it look like they are being generous and kind. Needless to say, I haven't had any such letter, even though my annual shortfall to HMRC is usually less than £500, they somehow still feel that I need to submit a tax return.


bayard said...

It could just be incompetence. One year I received a letter from the Inland Revenue, saying I no longer had to submit a tax return, almost immediately followed by one saying that I once again had to, implying that this was because I had in some way transgressed.

Oldrightie said...

It's no accident. If they can hide a surplus overpayment, just like the utilities, they make it appear they are doung you a favour.

Anonymous said...

This has been going on for years.

I am an accountant and I see it all the time.

One of their favourites for this are pensioners. It's not unusual for people to have two or more pensions in addition to their state pension. In these cases it is difficult for the Revenue to accurately collect the tax, so they ALWAYS deduct too much tax and then write to say they will no longer issue a tax return.

Given that I obviously charge a fee for doing tax returns, a lot of people just accept that they will overpay becuase it beats the fuss and cost of doing a return.

Others, who have never employed an accountant, just remain blissfully ignorant.

Anonymous said...

I too regularly receive £1500 - £2000 tax back at the end of each year (and I’m on PAYE).
About 4 years ago I was told that I no longer have to fill out a tax return as I’m PAYE. It takes me considerable effort each year to persuade them to send me a tax return; they really don’t want to inconvenience me with a tax return.
My wife, also PAYE and has never completed a tax return, received a phone call from the tax office asking her if she was owed any tax, she said no as she was on PAYE, the man from the tax office said thank you very much and hung up. She was owed over £400 in tax.
If you are on PAYE and make pension contributions, charitable donations or have benefit in kind, then the tax office will owe you money at the end of the year.

Another tax accountant said...

They also don't repay overpayments of tax until you formally complain.

'Security checks' is the standard excuse. Security of WHAT?!?

Anonymous said...

A few years ago I got a load of bullying letters from HMRC as I hadn't done a self assessment for 5years.
Reasons Being a) They always owe me b) when they do all the fines are waived.
So I get my accountant to whip up 5years assessments tout suite and HMRC owe me £7K.

After they paid up, I was told I didn't need to do a self assement.

Now I've always been a hgher rate taxpayer and I havent done a SA for 6 years now...

Joe Public said...

And they're Sneaky Bastards in another way.

If you're late making your Tax payment to them, they charge 5% interest (I think); if they screw you for too much tax but don't repay it until you request it, they pay you only 0.2%.

Anonymous said...

I concur with what accountant said at Sat. 13:47. Being an accountant myself, I find that in most cases, once all your income is on PAYE, they'll soon get round to no longer asking you to fill in a return, regardless of the tax codes they are using. It'll be left up to you to claim back any repayment due. They just automatically assume that their tax codes are working it out all correctly, which in many cases, is not the case.
Tax codes are just like paying your gas/elec supplier by direct debit: they work out these codes to try and collect the "average" right amount per month, but it doesn't mean that they have actually deducted the correct tax off you, once the annual figures are added up.