HMRC Says Sorry Over £100 Penalty Notice Blunder

The taxman is to write and apologise for sending hundreds of taxpayers £100 penalty notices even though they had filed their self-assessment tax returns weeks before the deadline.

Her Majesty’s Revenue & Customs (HMRC) admitted the mistake after The Times revealed on Saturday that taxpayers who had filed online were sent letters telling them they were late and would have to pay a fine. The deadline for online returns is January 31.

The tax office insisted until last night that those given penalties had filed late paper returns and so should pay. The deadline for paper tax returns was October 31.

More than 650 taxpayers received HMRC’s letters. Dan Neidle, a partner at the City law firm Clifford Chance, filed a tax return in his role as executor for a deceased friend’s estate held in trust. “I’m a tax partner in an international law firm. I have no doubt I filed electronically within the deadline. The mistake was clearly HMRC’s. If it was just me who was affected then I’d treat this as something of a joke. But I suspect many people would find a £100 demand confusing and even distressing,” he said.

More than 11.5 million people are expected to file a self-assessment tax form. They include self-employed workers, company directors and anyone who has earned untaxed income from dividends or interest on savings for example. They also include an aver- age of about 160,000 people declaring income on trusts. It is some of these who were affected by HMRC’s mistake.

The tax office said it believed that the error occurred on January 2 on 653 returns. It said: “Due to human error in processing some online trust returns a small number of trustees or agents have been inadvertently issued with late- filing penalties. All affected returns have been identified and the penalties have been cancelled. We apologise for any issues this may have caused our customers and are writing to them.”

From today’s Times