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The Association of Taxation Technicians (ATT) has revealed that problems with HMRC’s IT systems earlier this year, relating to calculations for payment on account, mean that some taxpayers will not receive tax demands this month.
The glitches in the tax authority’s systems during the self-assessment tax return season also mean that calculations for payment on account on some returns may not be adjusted correctly.
It was apparently made clear at the time that HMRC’s systems had not processed payments on account for 2018/19 correctly. Unless affected taxpayers contacted HMRC to correct the position, they will not have received a demand in June or July for the second payment on account due by 31 July 2019.
Instead, those affected by this HMRC failure will need to pay their total 2018/19 self-assessment tax bill by the end of January 2020 and the ATT is advising them to set additional money aside to make sure their bill is covered.
Jon Stride, Co-Chair of the ATT’s technical steering group, said: “If a taxpayer does not make any payments on account during 2019, then their tax bill in January 2020 could be significantly larger than they are expecting and could come as quite a shock.
“Individuals who do not receive expected demands should either set aside the funds needed ready for next year or, if they wish, they can make a voluntary payment on account to HMRC of their July payment – and their January payment if that was also missed.”
The ATT has been told by HMRC that if no 2018/19 payments on account have been demanded, then the taxpayer will receive a demand from HMRC for the full amount of tax in January 2020.
Self-assessment taxpayers with annual tax demands of £1,000 or less do not have to make payments on account, while those in the regime who have 80 per cent or more of their total annual tax collected at source, such as by PAYE, do not have to make payments on account either.
Businesses across the UK are being reminded that, if they process personal data, they are subject to a legal requirement to pay the Information Commissioner’s Office (ICO) an annual data protection charge, unless they have a relevant exemption.
Any businesses that fail to pay the correct charge are at risk of a fine of up to £4,350. A list of businesses that have paid the charge is published on the ICO’s register of data controllers.
The amounts that businesses must pay are determined by their size, with micro organisations and sole traders paying £40 a year, SMEs and equivalent organisations paying £60 and large organisations paying £2,900.
Where an organisation pays the charge by direct debit, they will receive a £5 deduction.
There is a tool available on the ICO website here so that organisations can determine whether they are subject to the charge.
A new study has found that more than half (58 per cent) of SMEs are not aware of a temporary two-year increase in the annual investment allowance (AIA), which could help them secure £1 million in funding. Read more