Higher rate taxpayers who have not submitted previous years tax returns are being offered the opportunity to come forward and pay up under a time limited HMRC campaign.
The tax return initiative launched on 3 July is aimed at people liable to pay tax at 40% or 50% and have been told to submit a self-assessment tax return for 2009/10 or earlier but have not done so. The campaign is also available to any individual who has tax returns to submit to HMRC for these years.
Taxpayers will have until 2 October 2012 to tell HMRC that they plan to take part, submit completed returns, and pay the tax and national insurance contributions that they owe. By coming forward voluntarily the individual will receive better terms and may be subject to a lower penalty where one is due.
Many employees, who pay tax through the PAYE system, are unaware that they have become higher rate taxpayers if their total income exceeds £42,475. Once this threshold has been exceeded there will be additional income tax due on any bank or building society interest they receive with only basic rate tax deducted at source. This also applies to other forms of investment income.
Any reader who has concerns should telephone Frank Collingwood on 01865 244661 in our Oxford office who will be pleased to assist. Frank is a Chartered Tax Adviser.