HMRC’s regulations all have time limits built into them. Taxpayers have submission deadlines. For submitting essential paperwork, like self assessment tax returns, and to make claims for tax rebates that might be owed to us.
HMRC also imposes certain deadlines on itself when it comes to investigating claims.
Different taxes have different time limits. And the time limits also vary according to the reason why HMRC is initiating an enquiry or discovery assessment.
It’s important to be clear on both of these sets of rules to make sure you don’t miss out on any tax relief you’re due by missing the deadline. And also so that you’re aware of your position, should HMRC need to look into any of your paperwork or payments.
How long do I have to change a claim after I’ve submitted it?
If you’ve submitted a tax relief claim within your self assessment tax return, you’ve got 12 months from the filing deadline to change it (after you’ve sent it to HMRC).
How long does HMRC have to investigate me after I submit a tax return?
Typically, if you got your tax return to HMRC on time, then HMRC has one year from that date to start an enquiry.
If you make any amendments to your tax return after you submit it to HMRC, then this year is measured from the date of your changes.
There are different timings for other situations, like the taxpayer becoming deceased, the deadline is missed, or no return is filed at all. And the particular rules are applied on a case by case basis.
What are HMRC discovery assessments?
HMRC can start a discovery assessment on closed tax years if they discover the possibility of unpaid tax. In contrast, an HMRC enquiry is into open tax years, where your bill hasn’t yet been settled.
There are time limits on HMRC concerning when they can launch a discovery assessment. Income tax, Capital Gains Tax, Corporation Tax, PAYE and VAT have the same time limits, in most circumstances. These are based on HMRC’s suspicions about why there is unpaid tax and are measure from the end of the tax year in question.
- Normal time limit: 4 years
- Careless behaviour: 6 years with one exception, VAT is 4 years
- Offshore matters: 12 years
- Deliberate action or failure to notify: 20 years
What are my time limits for claiming tax relief?
Usually, the time limit on claiming any tax relief is four years from the end of the tax year in question.
So the following deadlines currently apply:
- 2016-17: 5th April 2021
- 2017-18: 5th April 2022
- 2018-19: 5th April 2023
These deadlines apply to self assessment and PAYE taxpayers. HMRC can make repayments outwith these times, according to their regulations ESC B41, which states: “…repayments of tax will be made in respect of claims made outside the statutory time limit where an over-payment of tax has arisen because of an error by the Inland Revenue [now HMRC] or another Government Department, and where there is no dispute or doubt as to the facts.”
Corporation Tax relief deadlines are set according to your accounting periods.
HMRC has provisions in place to analyse each taxpayer’s position on a case by case basis and build in flexibility to their rules for exceptional circumstances.
These deadlines are not applicable to the time limits for:
- Evidence of facts and two year rules for VAT assessments
- Class 1, 1A and 2 NICs assessments
- Direct tax penalties
- CTSA or SA returns enquiries
- Out of date periods (as defined by previous time limits)
Why do I need to know these deadlines?
A good question. At first, these deadlines don’t seem that important, especially if you’ve always got everything in and paid on time. You’re not worried about possible disclosure assessments.
But you do need to make sure that you’re keeping the requisite evidence for the right amount of time. Not only is this your protection, but it’s a legal requirement.
Knowledge of the deadlines are also important for you if you’re applying for a tax rebate. It’s great that they are backdated for four tax years, but once that deadline is passed, your money’s gone for good.
It’s just worth checking in with your tax position, just to make sure you’re making timely claims and you’re keeping all the records you need.
