Fines for tax return mistakes might be cancelled if you tried to call HMRC for help.
It has recently come to light, that HMRC has cancelled or reduced a number of fines issued for incorrectly completing or late filing of tax returns. This acknowledges the impact their poor customer service has had on the taxpayers’ ability to complete forms correctly, without any support from HMRC. If you tried to call HMRC during your tax return preparation – even if you didn’t get through – then any fines for mistakes might be cancelled. An HMRC spokesperson stated that: “If someone says they tried to call us we will take their word for it. We do not want to penalise anyone.”
In the 2014-15 tax year, 90,000 mistakes on tax returns were defined as “careless or not otherwise deliberate” by HMRC. There were also 15,000 “deliberate”.
An official report from government ministers labelled HMRC’s customer service “abysmal” and revealed that there were 12 million unanswered phone calls in the first half of the year – that’s half of all calls made to HMRC by confused taxpayers. I wonder how this will be reflected by the figures for accidental mistakes this year.
An HMRC spokesperson responded by saying:
“We know our customer service hasn’t been as good as it should be so we have moved a further 3,000 people it them and things are getting better. All this means no-one should get a penalty for missing the January 31st deadline, or for putting the wrong figures in their returns because of call waiting times. A penalty for a return that was on time would only apply for failing to take sufficient care to get it right.”
It has been widely reported that HMRC has cancelled hundreds of “late penalties” if the taxpayer had a “reasonable” reason for their late filing. Their definition of “reasonable” has been broadened considerably, allowing more taxpayers to benefit from this turnaround.
This recent development will probably make the most difference to people who have made small mistakes. You can end up owing 30% of your total tax bill for “carelessness”, so it could be quite a lifesaver. Some fines, inevitably, will still be handed out. These range from £100, to a daily £10 fine if the situation is not resolved after three months.
