With the majority of local and international media covering the affects of the economic downturn on big business and banks, 1st Contact have decided to investigate how the current financial conditions will affect smaller, local businesses. In the most recent reports in January 2009, taxpayers have been notified that they will not suffer because of a computer glitch with the HMRC computer system. If you are late in paying for your 2007-08 taxes you still have time due to the glitch and thanks to the changes to the PAYE tax code for 2009-10. Due to the error the option on the Revenue’s system for online filing for self-assessed taxpayers allows extra time to pay.
You now have the honour of opting for a lower tax code instead of having to pay all of the taxes owing up to £2000. After December of 2008, the box should have been removed for paying a lower tax code for PAYE, if you were filing online but it did not and it is still available. The idea behind offering this lower PAYE code was to give the HMRC enough time to tell all employers what their employees’ new tax code should have been.
However, for anyone who decided to pay their backdated taxes, after December 2008, they might not even have been aware of anything being untoward. They might have found out later that their taxes were not being deducted from their wages as they had intended. These people, as innocent as they are, would have been susceptible to surcharges and interest charges after January. 1st Contact will be able to discuss any tax related matters and they can provide assistance and support through these hard times.
The Revenue Service reports that there are still some problems with the online tax filing system, but you should write or call the HMRC for an explanation if you owe more or less than what you think. There is no quick repair for the system but the public are still responsible for paying their taxes promptly and fairly. You may do so by post and your new deadline is the 31st of January ’09. It is in your best interest to pay promptly if you owe anything to HMRC rather than hold it up as rules may change for next year. Penalties can always be harsher.
There should have been no more tax glitches this year as the rush was on at the end of January to file income taxes online. There is a £100 penalty if a return is late, and a further penalty to be paid on the amount owing. So it would serve you well to file early, avoid any upset, and pay what you owe. Your name will stand in good stead should you decide to do so.
1st Contact believes that at the very least business owners will have a fighting chance of keeping their heads above water and coming out of the recession on top.
1st Contact Tax offers specialist tax services to contracting professionals.
These services include: Contractor Accounting, Contractor Umbrella payroll, Personal Tax for Contractors, Limited Companies for Contractors and Contractor Financial Advice.