We have an extremely complicated tax system, so is it any wonder that even HMRC struggle to calculate your tax correctly!
The way that allowances are applied for dividends, allowances, savings and other items all impact on each other.
Many tax payers will be working on their 2016/17 returns (to 5th April 2017 due by 31st January 2018) over the coming months and find that they can’t use the HMRC software because it doesn’t work properly.
As reported by Accounting Web
Rob Ellis, CEO of BTCSoftware, can’t remember a year when there have been so many exclusions from filing SA tax returns online. For the 2016/17 tax returns 16 new examples have been added to the online filing exclusions list, which is now in version 4; there is a version 5 of this list under construction.
You can read the full list of exclusion on this link https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/622426/2017-exc-indi.pdf
There are 62 exclusions!
Why is tax complicated! Here are the facts:
- 6,102 pages of legislation (according to Tolleys in 2012)
- 639 monetary values
- 425 thresholds
- 214 penalties
- 11.26 million SA returns due
- 10.39 million returns were received in total
- Around 870,000 SA returns not submitted by 31st January 2016
- 10.39 million returns received by midnight on 31 January (92% of total issued)
- 9.24 million returns filed online (89%)
- 1.14 million returns filed on paper (11%)
- More than 4.45 million returns received in January 2016 (43% of total received)
- 823,000 returns received on 30 and 31 January (18% of total returns received in January)
- Busiest hour: 14:00 – 15:00 on 29 January – 50,358 returns received (839.3 per minute; 13.9 per second).
- N.B. The figures are sourced from Self Assessment management information from the Computerised Environment for Self Assessment as at 01 February 2016 for the 2014-15 tax year.
Even if the HMRC software is working…
10 most common online self assessment issues
Here are 10 of the most common problems, issues and errors that come up:
- Not leaving enough time to register for Self Assessment – It can take 20 working days (this is usually 4 weeks) to complete the registration process, then for online returns, allow 10 working days (21 if you’re abroad) to register because HM Revenue and Customs (HMRC) posts you an activation code.
- Lost Login details – Your account will be locked for 2 hours if you enter the wrong user ID or password 3 times.If you’ve lost both your user ID and password:
– individuals in Self Assessment can request new ones (allow 7 days to get them by post) or sign up with the GOV.UK Verify trial
– contact HMRC for all other online services
- Leaving it too late to get help – If you need help from an accountant don’t leave it too late as they will need to carryout AML and other checks before they can file your return, they will also need your UTR
- Failing to complete all the parts of the return – For example leaving out PAYE information
- Failing to press ‘submit’ – you would be surprised how many people complete the return and then stop without submitting or leave submission and then forget to do it
- Missing out details of your Pension Provider
- Failing to check the calculation – Most people do a rough calculation of what they owe but fail to check the HMRC calculation only to find out they have made a mistake
- Using invalid characters such as # ‘ ” in boxes where these are not allowed
- Not paying the tax they owe by 31st January
- Failing to explain where estimates and provisional sums have been used
If you don’t already use an accountant, may be 2017 is the year to start?