It seems HMRC are eager to get in as much tax as possible and have started issuing notices of tax due to some clients before receiving the client's Self Assessment tax return. So how are HMRC calculating what to charge? If you have a limited company you or your accountant may have submitted a P11D return to the Inland Revenue before the deadline in July. The P11D may contain items such as travel and subsistence, entertainment and professional subscriptions and depending on your position in the business these are likely to be free of any tax charge. Such items must also be reported in the individual's Self Assessment and it is important that the entries are made correctly in the Return to avoid any tax becoming due.
However, HMRC have started issuing notices of tax due to individuals BEFORE receiving their Self Assessment declarations. They have been taking the P11D figures submitted in July and suggesting in the P800 tax calculation that is sent out, that tax is due on all and any P11D benefit /expenses that have been reported. Clients have been calling in questioning why they have suddenly received large tax bills!.It does seem somewhat unfair of HMRC to make such assumptions before receiving self assessments but the message is clear - get your Self Assessment submitted as soon as possible to avoid this situation.
Please note - this is NOT a photo of an actual Carrington Client!
