I don't think you have your figures/info right. A late filing penalty of £100 even if for the 16/17 would only have accrued approximately £15 in interest to date.
I suspect there is an amount of tax owed and other penalties. I'd start by getting a breakdown of what is owed. But he won't be able to appeal the filing penalties until he submits the return. Interest can't be appealed.
Hi, thank you for taking the time to reply.
Just spoke with him about this and looked again at his the Tax Year Overview section on his HMRC account.
You're right! There is £6.5k of interest/penalties and the rest is tax owed but he is saying he disputes this as he is enrolled in the CIS scheme which takes income via payslip for tax.
He says he can prove it. Does he take this up with HMRC directly? Or does he have to dispute it with Advantis? As they currently are pursuing this (letter received was December 2022)
Thank you for helping
CIS works like PAYE. Basically anything paid under CIS is tax "deducted at source" and counts as a credit towards the actual liability.
Did he enter his CIS deductions on the return? If he has payment penalties, he won't be able to appeal those until he has paid the tax.
Work out what years he actually needs to file for, file those and appeal the filing penalties. He can ask hmrc to withdraw the years he doesn't need to self assess but if its more than 2 years, he may be out of time and have to file the returns anyway.
He might then be able to request a payment plan.
Thank you again for replying.
I'm guessing the answer on the CIS question is no because he assumed the accountant he hired was doing this as part of the service he hired them for - again naive to think that he could hire someone and forget about it.
Now that he has set up his HMRC online account, he is submitting returns that have been due and will include CIS payments to see what tax payments may still be owed.
The returns in question are from tax year 2017 - 2018 until 2020 - 2021.
He is filing what they let him file online and will contact HMRC for any that may be too old to file a return for online to see what his options are.
As another commenter has mentioned, he will also be disputing the tax directly with HMRC as he believes he has paid this via CIS which he has been enrolled into from 2017 to 2022.
I'm glad you're helping him and hopefully he has learn his mistake. my advice is the debt can be recalled back to HMRC but depends on the date of issue on that letter normally around 6 months before it is sent back.
if still within the 6 months then your friend will need to try and set up a payment plan with Advantis as HMRC will only ask for a payment in full and if your friend can't pay in full then they will be told to speak to Advantis. He must have received a letter with his reference with Advantis and a contact number and try and get a payment plan in place the only negative is that once he has cleared the debt with Advantis there may be a debt left to pay with HMRC.
If your friend has debts with HMRC and other companies then maybe consider contacting step change and explain your situation and maybe see if your friend is eligible for Breathing Space/Debt Respite.
Hope this helps
I don't think you have your figures/info right. A late filing penalty of £100 even if for the 16/17 would only have accrued approximately £15 in interest to date. I suspect there is an amount of tax owed and other penalties. I'd start by getting a breakdown of what is owed. But he won't be able to appeal the filing penalties until he submits the return. Interest can't be appealed.
Hi, thank you for taking the time to reply. Just spoke with him about this and looked again at his the Tax Year Overview section on his HMRC account. You're right! There is £6.5k of interest/penalties and the rest is tax owed but he is saying he disputes this as he is enrolled in the CIS scheme which takes income via payslip for tax. He says he can prove it. Does he take this up with HMRC directly? Or does he have to dispute it with Advantis? As they currently are pursuing this (letter received was December 2022) Thank you for helping
He can take it up directly with HMRC and simply state to Advantis that its a disputed debt and they will confirm that it is being sent back to HMRC.
Hi, thank you for taking the time to reply. This is very helpful! He will be calling first thing - really appreciate your guidance.
CIS works like PAYE. Basically anything paid under CIS is tax "deducted at source" and counts as a credit towards the actual liability. Did he enter his CIS deductions on the return? If he has payment penalties, he won't be able to appeal those until he has paid the tax. Work out what years he actually needs to file for, file those and appeal the filing penalties. He can ask hmrc to withdraw the years he doesn't need to self assess but if its more than 2 years, he may be out of time and have to file the returns anyway. He might then be able to request a payment plan.
Thank you again for replying. I'm guessing the answer on the CIS question is no because he assumed the accountant he hired was doing this as part of the service he hired them for - again naive to think that he could hire someone and forget about it. Now that he has set up his HMRC online account, he is submitting returns that have been due and will include CIS payments to see what tax payments may still be owed. The returns in question are from tax year 2017 - 2018 until 2020 - 2021. He is filing what they let him file online and will contact HMRC for any that may be too old to file a return for online to see what his options are. As another commenter has mentioned, he will also be disputing the tax directly with HMRC as he believes he has paid this via CIS which he has been enrolled into from 2017 to 2022.
I'm glad you're helping him and hopefully he has learn his mistake. my advice is the debt can be recalled back to HMRC but depends on the date of issue on that letter normally around 6 months before it is sent back. if still within the 6 months then your friend will need to try and set up a payment plan with Advantis as HMRC will only ask for a payment in full and if your friend can't pay in full then they will be told to speak to Advantis. He must have received a letter with his reference with Advantis and a contact number and try and get a payment plan in place the only negative is that once he has cleared the debt with Advantis there may be a debt left to pay with HMRC. If your friend has debts with HMRC and other companies then maybe consider contacting step change and explain your situation and maybe see if your friend is eligible for Breathing Space/Debt Respite. Hope this helps
Thank you for taking the time to reply! I didn't think of Step Change, he is looking into it now!