Did you miss the Self-Assessment deadline?

HMRC has announced that more than 10.7 million people submitted their 2019-20 Self-Assessment tax returns by the 31 January deadline. This leaves over 1.8 million taxpayers that have missed the deadline and are yet to file. Are you among those that missed the 31 January 2021 filing deadline for your 2019-20 Self-Assessment returns?

HMRC had announced that due to the coronavirus pandemic, fines for taxpayers that file their Self-Assessment returns late will be waived until 28 February 2021. However, interest will be applied to any outstanding balance from 1 February 2021 so you should try and pay your tax bill as soon as possible. If you are unable to pay your tax bill, then there are a number of options for you to defer the payment that was due on 31 January 2021.

This includes an option to set up an online time to pay payment plan to spread the cost tax due on 31 January 2021 for up to 12 months. This option is available for debts up to £30,000 and the payment plan needs to be set up no later than 60 days after the due date of a debt. This should be done sooner rather than later as a 5% late payment penalty will be charged if tax remains outstanding, and a payment plan has not been set up, before 3 March 2021.

If you owe Self-Assessment tax payments of over £30,000 or need longer than 12 months to pay in full, you can still apply to set up a time to pay arrangement with HMRC, but this cannot be done using the online service.

Are you among the over 958,000 taxpayers that missed the 31 January 2020 filing deadline for 2018-19 Self-Assessment returns? If you missed the filing deadline you will be charged a £100 fixed penalty if your return is up to 3 months late, whether you owed tax or not for the 2018-19 year.

If you do not file and pay before 1 May 2020, you will face far greater penalties. A daily penalty of £10 per day, up to a maximum of £900 (90 days), will be charged from 1 May 2020. Further penalties will apply if your return is still outstanding for more than 6 months after the 31 January 2020 filing deadline. From 1 August 2020, you will be charged a penalty the greater of £300 or 5% of the tax due. If your return still remains outstanding one year after the filing deadline, further penalties will be charged from 1 February 2021.

You can appeal against any penalties that have been issued and HMRC has said that they will treat appeals where tax-payers have genuine excuses, leniently. However, you need to act fast and the excuse must be genuine and HMRC can ask for evidence to support any claim. An appeal must usually be made within 30 days of receipt of the penalty.

If you need help sorting out a late return, please call. It is better to resolve any late filing issues sooner rather than later in order to reduce your exposure to interest and penalty charges. We can also help you make an appeal if you have a reasonable excuse for late filing.

Are you among the 700,000 taxpayers that missed the 31 January 2019 filing deadline for your 2017-18 self-assessment returns? If you missed the filing deadline then you will be charged a £100 fixed penalty if your return is up to 3 months late, regardless of whether you owed tax or not.

If you do not file and pay before 1 May 2019 then you will face far greater penalties. A daily penalty of £10 per day, up to a maximum of £900 (90 days) will be charged from 1 May 2019. Further penalties then apply if your return is still outstanding for more than 6 months after the 31 January 2019 filing deadline. From 1 August 2019 you will be charged a penalty of the greater of £300 or 5% of the tax due. If your return still remains outstanding one year after the filing deadline, then further penalties will be charged from 1 February 2020.

You can appeal against any penalties that have been issued and HMRC has said that they will treat those with genuine excuses leniently. However, you need to act fast and the excuse must be genuine and HMRC can of course ask for evidence to support any claim. An appeal must usually be made within 30 days of receipt of the penalty.

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Case Studies

The Tax Man

Minimise the stress of an investigation and make use of our extensive experience in securing best outcome for our clients

Business Valuation in Distress

Take advantage of our impartial and rigorous due diligence procedures

FD in The Cupboard

Our innovative ideas are here to improve your business performance and secure appropriate and cost effective funding

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The Tax Man

The Tax Man

A new client was introduced to us via a recommendation with whom we arranged to meet on a regular basis in order to determine a number of changes that we felt were needed to their business structure. The client was at the time operating as a husband and wife partnership. The business was flourishing and had a number of large contracts with big organisations.

At the start of the process they were still heavily immersed in their day to day operations so we can get a full flavour for their ambitions, aspirations and growth plans. We quickly recognised there were sufficient tax savings which can be achieved by changing the structure from a partnership to a corporate entity. We carried out a business valuation and disposed of the goodwill from the old to the new business. Unfortunately, as often is the case with efficient tax planning, HMRC got involved and disputed our valuation.

An HMRC investigation can be a very stressful time for any client, even for those best prepared. However, our client had minimal input in the HMRC communication as we dealt with this professionally behind the scene. As an added benefit, our client could rest on the security that all work was covered by insurance and therefore all costs and time in dealing with this enquiry were covered by the fee protection policy we had put in place.

The initial approach taken by HMRC was very aggressive and they tried to present an argument that there was no goodwill in the business. We challenged HMRC’s view that the goodwill was worthless. After lengthy correspondence and numerous telephone calls, HMRC agreed 100% with our original valuation, which preserved our original tax saving plan for the client. Tax savings on this case where in the region of £75K at the outset, with ongoing savings of £6,000 per annum. We are pleased to add another happy client to our portfolio.

Business Valuation in Distress

Business Valuation in Distress

Selling a business is never an easy process, but when disputes arise, the need for a reliable third party due diligence process is even greater.

Tearle & Carver have extensive understanding of the requirements for remaining objective when managing a potentially difficult company buyout. In one such case, we were approached by the courts to act as independent accountant for an acrimonious business sale in which one partner was exiting the business and selling shares to the other. Given the circumstances, both sides had totally polar views of what their business was worth.

After arranging an initial meeting with the company, we were thorough in ensuring we completed due diligence, validating the figures in the accounting records, carrying out adjustments where appropriate, and drafting a set of reliable management figures within the framework required by the court.

A draft version of the report detailing our findings and conclusions was submitted to both parties, giving them the opportunity to voice any queries or concerns and ensure all relevant factors had been taken into account.

Through this process, we were able to submit a final report to the courts that was both binding and acceptable to both parties, effectively resolving what could otherwise have been a time consuming and costly process for all sides.

FD in The Cupboard

FD in The Cupboard

For smaller companies, it is often not possible or cost effective to pay for a full-time Financial Director.
Many of our clients therefore make use of Tearle & Carver’s extensive expertise to provide the services of an FD as and when required.

In this case, we were approached by the management team of an organisation looking to acquire the existing business via an MBO (Management buy out). Their business plan had proved ineffective for securing funding, and what they needed was financial expertise from someone with a developed understanding of the company’s internal workings.

Tearle & Carver helped deliver the solution our clients were looking through utilising our bank contacts in order to make the MBO viable, while also building a robust business plan and preparing our client for the rigorous vetting process. To help with cash flow issues, we introduced factoring which led to improved cash flow management.

We advised on the appropriate business valuation and structure, and continued to prepare monthly accounts to track profgress once the management were fully in command of all the information they needed to move their business forward.

In order to best assist these clients through the crucial first year of ownership, we attended board meetings on a regular basis, a service that we continue to provide to date.

With our continually developing understanding of their business, this client is able to remain confident that Tearle & Carver can provide any financial support they may need, now and in the future.