Although filing a tax return late will incur penalties, you are allowed to appeal the decision should there be a reasonable excuse.
The government provides a list of these acceptable excuses on their website, ranging from situations outside of your control to serious personal issues.
- Your partner or another close relative died shortly before the tax return or payment deadline.
- You had an unexpected stay in hospital that prevented you from dealing with your tax affairs.
- You had a serious or life-threatening illness.
- Your computer or software failed just before or while you were preparing your online return.
- Service issues with HM Revenue and Customs (HMRC) online services.
- A fire, flood or theft prevented you from completing your tax return.
- Postal delays that you couldn’t have predicted.
The government website also lists various unacceptable reasons for a late return, for example that no reminder was received or the online system was too difficult to use. Essentially, you are responsible for your tax return and can’t pass on the responsibility if the deadline has been missed.
Back in 2015, the HMRC also published a report detailing some of the more creative reasons used to evade a tax penalty. The excuses were all part of unsuccessful appeals, showing that any neglect on your part – whatever the extremity of the circumstances – isn’t likely to carry favour.
Here are a few highlights from the list:
- “My pet dog ate my tax return… and all the reminders.”
- “I’ve been travelling the world, trying to escape from a foreign intelligence agency.”
- “A work colleague borrowed my tax return, to photocopy it, and didn’t give it back.”
- “My girlfriend’s pregnant.”
- “I’ve been far too busy touring the country with my one-man play.”
As you can see, appealing to the HMRC without a good excuse usually falls on deaf ears. If your accounts aren’t in order, or you lose track of deadlines, then it’s difficult to avoid the additional charges coming your way.
However, the worry of a looming deadline and late tax return penalties may become a thing of the past under the new ‘Making Tax Digital’ plans.
Making Tax Digital
Under government plans to transform the tax system, every individual and company based in the UK will have their personal tax account moved online. However, an End of Year Declaration will still have to be filed nine months after the tax year end.
This means that, although late returns will become less commonplace under the new arrangement, a reasonable excuse is still required to appeal a tax ruling successfully.
With this in mind, remember that any late returns will incur costly penalties without a reasonable excuse. If you attempt an appeal, take into consideration the acceptable excuses as noted above – and also those that won’t work so well! – before contacting the HMRC.
If you’d like a professional to undertake your tax returns so you don’t have to worry about excuses, contact us today.
If you’d like to know more about the Making Tax Digital plan, you might find How Will HMRC’s Move to Digital Self-Assessments/Accounting Affect Your Business interesting.
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