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HMRC asking Agents to Check 2022/23 Tax Returns For Errors

02 - 08 - 2024

HMRC is asking agents to check their clients’ 2022/23 Self Assessment Tax Returns for inaccuracies. 

As part of its work to maintain compliance standards through working with agents, HMRC is writing to agents where discrepancies are found between the client’s tax return and the employment or Child Benefit information held by HMRC.

 

The agent can contact HMRC to request further details or HMRC will call the agent in the weeks following the letter. Agents with 20 clients or more are being targeted where a potential discrepancy is found.  

 

If errors are found following the agent’s review, voluntary amendments can be made by 31 January 2025 without a penalty being levied. If, however, there is additional tax to be paid interest will be charged on the underpaid amount.

 

These initial checks are not Compliance Enquiries, however this may be the next step if the discrepancies are not corrected. An enquiry can be time consuming and can result in penalties as well as interest payable on underpaid tax.

 

Your Agent, usually your Accountant, can complete a review of the 2022/23 tax return they have prepared for you. You should also consider whether you have supplied all of the relevant information to your Agent in order to complete the return. Did you, for example:

 

• supply a P45 or P60 for each employment you held in the tax year? If you have had several employments you may have forgotten or misplaced some information.
• receive company benefits which were included on a P11D form from your employer?
• claim (or did your partner claim) Child Benefit during the 2022/23 tax year and you or your partner received taxable income over £50,000?

 

If you discover that you have missed anything, contact your agent and/or consider amending your Tax Return as soon as possible.

 

If you have any concerns or queries about Self Assessment we can help. Contact our friendly team on 01244 625 500 or contactus@foremansllp.com.

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Fixed Data

Assumptions

General                                                                                                                              

• The user is over 21 and subject to tax in the UK
• The user wishes to minimise their tax liability
• The user is subject to national insurance i.e.he/she is not over retirement age
• Only current tax rates and limits are applied
• No tax mitigation payments are made e.g. pension contributions
• Only 3 digit letter 'L' tax codes shown in the drop down list can be entered 
• The user does not have a turnover greater than £100,000 where fewer reliefs and or higher taxes may apply

Expenses

• All miles claimed as expenses are for business use using a personally owned car or van
• All other expenses claimed are wholly, necessarily and where appropriate exclusively for the benefit of the business

Foremans LLP Charges

• Foremans fees associated with Limited Company, Sole Trader or Umbrella are as per published rates
• Foremans current Service Costs are allowed for in all calculations.

Holiday Pay

• Holiday pay is accumulated week by week by Umbrella or Agency employer but paid out during the year

VAT

• Limited Company or Sole Trader will be VAT registered
• Limited Company or Sole Trader will take advantage of Flat rate VAT
• Flat rate applied includes the benefit of the additional 1% applicable to the first year of VAT registration

Limited Company Conditions

• One director / one shareholder in a Personal Service Company
• Director of Personal Service Company elects to vote for 100% dividend after salary, costs and expenses
• Director's salary is maximum salary to the primary threshold for NI
• The Limited Company is trading normally i.e it is not subject to IR35 and is not a Managed Service Company

NOTES

• The Current tax rates are taken from the Fixed Data Table
• The current Value Added Tax Rate is 20% and is applied to all invoices and expenses as appropriate
• The Director's Salary is fixed in relation to National Insurance thresholds. Higher Rate Taxpayers should consider the advantages and disadvantages of a larger annual salary or bonus
• Higher Rate Taxpayers may wish to consider the advantages and disadvantages of shared ownership of their business
• Users with a tax code other than three digits and letter "L" may telephone or email our Development Department to request a detailed calculation
• Generally the use of an Umbrella rather than an Agency payroll is only efficient if sufficient weekly expenses are allowable and claimed
• The expenses claimed under an Umbrella should not prevent the proper operation of National Minimum Wage