Content
Leading article...
We can't go on like this...
General tax...
The name is Bond
Blessed are the givers
Excuses, excuses
PAYE the penalty
Silver and gold
Moving goalposts
Doctor, doctor...
Something phishy
Pension problems
Tax dot com
Unpleasant discoveries
Fair's fair (at last)
Chartered taxpayers
This year, next year
VAT...
Focus your mind
Flat rates aren't flat
Reverse the charges
Flapjack flash
Ready set ECSL
A lofty idea
Law items...
I want my lawyer
Not on my holiday
A grey area
No difference
| When you have filed your tax return, you hope that's the end of that. The taxman has a year to raise routine questions, and then it ought to be done and dusted. Unfortunately, it isn't that simple - HMRC still have the right to ask for more tax if they make a "discovery" by 31 January 5 years and 10 months after the tax year. They can't use this power if the return contained enough information for them to appreciate what had happened when it was submitted, but if it didn't, the taxpayer has no protection. In a recent case, the taxpayer treated an "offshore bond" - fully taxable at 40% - as if it had been a UK investment, only taxable at higher rates of income tax. The Tribunal agreed that this was an innocent error, but there hadn't been anything in the tax return to alert the Inspector. The law was complicated, but the taxpayer should have recognised that and taken advice to be sure that the return was correct. The extra tax had to be paid. It's important not only to check that the numbers in a tax return are as accurate as possible, but also to think whether any words should go with them to try to get protection against discovery. "Hoping the taxman never finds out" is not a safe strategy. |
© Bayar Hughes & Co., 2010.