Glitches, scammers, and latecomers make ‘Pay Your Tax Bill Day’ drag
Freelancers are hoping that their accountant isn’t one of the many whose uploads on “Pay Your Tax Bill Day” failed, due to HMRC’s self-assessment portal suffering technical glitches.
Taking to LinkedIn, tax dispute expert Jeremy Johnson said that despite HMRC’s penalty waiver, he wanted to file his clients' returns early yesterday, but got an ‘Error 503’ message.
Like inTaxLtd, where Mr Johnson is director, another accounting firm was unable to file self-assessment forms too, seemingly because upload software was conflicting with HMRC’s site.
'Trying for a full set of HMRC error messages'
The firm, ETC Tax explained yesterday: “[We have] had Error 502 and Error 504 so far this morning. We are missing a 503 error message, though. Let’s keep trying to get the full set!”
Before a shocked-face and exploding-head emoji, a third tax advisory BBK Accounts Ltd responded: “Yep we are having the same problem here.”
Other freelancers’ accountants seemed to question leaving the filing of self-assessment forms to the last, partly given HMRC’s patchy track record in its site standing up to countless users.
'Rename the 31st to 'Pay Your Tax Bill Day''
“I know where I am with my tax position in April, so I don’t have this issue in January,” said ex-inspector Jesminara Rahman, albeit to a taxpayer aghast at paying HMRC yesterday.
The taxpayer, an advertising specialist who mused that yesterday should be named “Pay Your Tax Bill” Day” said she too prepared months ago.
But she maintained that it still pains here to fork out so much to the Revenue in one fell swoop.
'Ridiculously complicated tax return'
According to the boss of a well-established accountancy firm, the pro-active ad specialist is in the minority however.
On condition of anonymity, the boss agreed to share a little phone-based anecdote which he said summed up many of the exchanges with his mostly self-employed clients.
The boss told FreelanceUK: “Client: ‘Really? I really need to file a return before the end of this month; the same as I’ve done for the last FIVE years. Well, why didn’t you say so!?.’
“Me: ‘I did say so, at the start of May last year. Then I said so at the start of June, and I said so at the start of every month up to this month.’
“But don’t worry, of course we can complete your ridiculously complicated tax return for you under intense time pressure and the [threat of HMRC penalties]! Hello?! Are you still there?!’”
'HMRC will be scrutinising these returns'
This year like last year, the Revenue has waived late penalties for returns which don’t make yesterday’s January 31st deadline, but are filed by February 28th 2022, observes Qdos.
While welcome, the waiver must not lull freelancers -- or their accountants --- into a full sense of security however, warns Qdos’s CEO Seb Maley.
“While this leniency [from HMRC] is good news in light of the pandemic, that’s not to say HMRC won’t be scrutinising these returns,” Mr Maley began.
“The fact of the matter is that the Treasury is under pressure to raise revenue and with 12.2m self-assessment returns to be filed, it’s a big pond for the taxman to fish in.
“With this in mind, accuracy – along with protection in the event of a tax investigation – is key.”
'14-day grace period, post-reasonable excuse'
Another potential helping hand from HMRC to freelancers, came courtesy of an update to its internal guidance earlier this month.
But similar to the HMRC late penalty waiver, the circumstances when experts say it ought to be relied upon are slim.
WTT Consulting, a firm which helps freelancers in dispute with the Revenue, reflected: “HMRC has amended their internal guidance to allow a 14-day grace period after any ‘reasonable excuse’ has ended to make payment or file the SA return.
“This means that in considering any appeal against a penalty, HMRC will automatically accept that the position was remedied as soon as possible after the reasonable excuse came to an end, as long as it is done so within this period of grace.”
'Something that stopped you...'
The firm’s tax investigations director Thomas Wallace cautioned: “For the appeal to be successful, you will still need to demonstrate that the default occurred due to ‘something that stopped you from meeting a tax obligation that you took reasonable care to meet.’
“[And be aware] there is no definition of ‘reasonable excuse,’ and they are considered on a case-by-case basis using precedents established through case law.”
Wallace’s advice coincides with the Low Incomes Tax Reform Group warning sole traders of five "myths" which scammers are perpetuating – just as returns get filed-- in relation to the Self-Employed Income Support Scheme.
Unfortunately for freelancers, so-called ‘SEISS scams’ are in addition to the usual impersonations of HMRC which tend to spike in number in the current tax return season.
Crunch, a Brighton based accounting software platform advised: "Fraudsters…are sending out false texts and emails claiming to be from HMRC and claiming a rebate is due, or threatening court action. Please be vigilant – if you do get something like this, you should contact HMRC directly to check whether the message is genuine."
1st February 2022