With HMRC actively seeking to improve their operations and tax collections, the latest details regarding compliance for last year’s tax returns have emerged. Hundreds of thousands of people are thought to be expecting letters from HMRC informing of them of fines of more than £1,200 for not completing their 2010/11 tax returns.
The figures, reported by law firm Pinsent Masons, found that HMRC have issued 1.16m penalties to taxpayers who missed the deadline of 31st January this year. Their tougher new system also means that the minimum penalty for non-filing is £1,200; which includes £900 in daily penalties plus a further late-filing penalty of £300 or 5% of the tax due if higher.
Pinsent Masons also calculated that fines for not filing tax returns could exceed £950m this year, compared to £250m last year through the old system. This is heavily increased by the new rule of a minimum £100 fine for those who do not complete returns, even if they have no tax to pay.
HMRC’s reportedly sent out around 500,000 letters last week, and their Director General for Personal Tax, Stephen Banyard, said that nearly 6% of taxpayers have not send their 2010/11 returns and are therefore receiving a penalty.
He continued, “We want the returns, not the penalties. This year, half a million more people have filed their return – which means we are issuing 44 per cent fewer penalties.” However, he also confirmed that “where someone has a reasonable excuse for not sending a return on time, we will waive the penalty.”
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