Bristol tax payers are being told to be wary of ‘phishing’ emails from fraudsters posing as HMRC as the January 31 deadline looms.
Accountancy, investment management and tax group Smith & Williamson is urging newcomers to tax self assessment to register for online filing of their tax return as soon as possible to avoid a penalty – while also being careful not to be conned by the many fraudulent emails and websites prevalent at this time of year.
Imogen Hilton-Brown, pictured, partner and head of private client tax services at Smith & Williamson’s Bristol office, said at this time of year there was a spike in ‘phishing emails’ which appear to come from HMRC. 
More than 22,000 fake websites have been closed over the past 18 months or so by the HMRC – an average of 40 a day.
“It’s a very real threat,” she said. “If you are using HMRC’s free software, go to gov.uk to find the right place to file your return.
“HMRC says it will never send an email with a link to the software – so do not click on links in phishing emails that appear to come from HMRC.
“It’s also wise to change your government gateway password regularly as this reduces the chance of anyone else using it and stealing from your account by fraudulently amending your return online and rerouting a tax repayment.”
Newcomers to tax self assessment need to register for online filing as soon as possible to meet the January 31 deadline and avoid an automatic late filing penalty, said Imogen. If any tax is outstanding, interest and additional charges quickly mount up.
As a rule of thumb, January 21 is effectively the latest date to register with HM Revenue & Customs (HMRC) for the 2014/15 tax year, although the tax authority does not specify this date.
“Remember it can take at least seven working days – longer if you live abroad – to get the necessary activation codes,” explained Imogen. “Bear in mind that HMRC can issue penalties to taxpayers who miss the filing deadline because the necessary details do not reach them in time.”
Imogen also explained that completing a tax return can bring rewards.
“An estimated 180,000 higher rate tax payers making pension contributions forget to claim the full tax relief, leaving over £200m in unclaimed relief,” she said. “Even if you are enrolled in your employer’s money purchase group pension plan – one of the commonest arrangements – you may still need to claim the higher rate relief yourself.
“If a 40% tax payer puts an extra £800 into their pension, they are usually eligible for a total of £400 tax relief. While they automatically get tax relief of £200, making this a £1,000 gross payment into the scheme, the majority of people must claim the balance of £200 tax relief. To do this, they typically need to complete a self assessment tax return.”
She added: “Finally, don’t miss the deadline just because you think you have no extra tax to pay. Even if your tax liability is nil but HMRC has asked you to file a return, you are likely to get a £100 fine if you miss the end of January filing date. However, HMRC has the power to cancel notices to file a return, so if you think you no longer need to submit one then do get in touch with HMRC – and the sooner the better.”
Smith & Williamson offers the following tips for completing the annual self assessment tax return:
1. If you do not already have an online account, register straight away for online filing https://www.gov.uk/log-in-file-self-assessment-tax-return
2. Collect the paperwork, which typically includes:
a. For the employed: you need and year-end form (P60) and leaver form P45 from any employers you had in the year (or if those are lost you can use your final payslip for the year from your employer(s)) plus details of benefits in kind (P11D).
b. If you have investments: details of share dividends, sales, losses, interest on bank accounts and any other investments.
c. Rental property: you’ll need details of incoming receipts, expenses, capital gains and losses, and so on.
d. Pension contributions: get confirmation of the amount you have contributed.
e. Details of any payments under gift aid to charities – higher rate taxpayers can claim the higher rate relief on this.
f. For the High Income Child Benefit Charge (HICBC): details of the child benefit received and knowledge of which partner has the higher income if over £50,000.
3. If you are missing some of the figures, make an estimate and explain your working.
4. If you anticipate a drop in your self assessment taxable earnings for the 2015/16 tax year, you can claim a reduction in your payment on account.
5. Keep a record of your completed form and associated paperwork. If you are in a business, eg you are self employed, this will be for a further five years, so up until 31 January 2021. Otherwise, you must keep the paperwork until 31 January 2017.
6. Watch out for recent changes in the law which affect 2014/15 tax returns:
a. If you have been moving in and out of the UK ensure you are aware of the statutory residence test rules – a useful flowchart is available at http://www.smith.williamson.co.uk/uploads/publications/statutory-residence-test.pdf.
b. If you have carried out any tax planning that might be deemed abusive, you may need advice on whether the general anti-abuse rule applies. This is a subjective test and may be difficult for taxpayers to apply themselves.
