NRCGT return

[Lambs]

It's the most viewed thread in tax history, I'd wager.

Regards,

Lambs

[etf]

Thanks lambs. I have to confess a few of those hits might be me!

The accountingweb thread suggests daily penalties may have been re-introduced (potentially a £900 addition for those caught up in the crossfire) and if true this thread is just as relevant today as it has ever been. Must have missed that HMRC announcement.

And MTD for income tax is Harra's next car crash on the rank.

Still hoping the professional bodies will start asking HMRC some searching questions. I noticed one respondent mentioned their sitting on hands approach....I very nearly added to the death in service count shortly after this reporting started and so the following post particularly struck a chord:

By Pavilionaire
24th Aug 2022 12:14
HMRC should have pulled the plug on the CGT 30-day thing the moment we went into Covid lockdown. Dealing with this additional tax reporting burden whilst preparing furlough claims and answering client queries about SEISS grant, then post-Brexit changes, the introduction of MTD has really ramped the pressure up on accountants and tax agents. ENOUGH ALREADY! There is no additional labour to source to help with this extra work and - locally - I have seen many older accountants either retire or - in 3 cases - actually die whilst still in practice. Meanwhile, our professional bodies look on and do nothing.

[etf]

The following is currently showing on the litrg website (the accountingweb thread suggested daily penalties are back). Hopefully the zero daily penalties position still stands, but if anyone has received a recent penalty for a late 60 day CGT return which includes daily penalties that would be interesting to know.


In either case, HMRC may charge late submission penalties depending on how late the 60-day (or 30-day) report is. However, HMRC have confirmed they will not charge daily penalties for late 60-day (or 30-day) reports.

[etf]

I took delivery of a new tax book yesterday and it informed me that from 6 April 2024 certain landlords will need to keep records of their income and expenses digitally, using software that is Making Tax Digital compatible, and report electronically to HMRC quarterly, as well as submitting an end of period statement before the usual self-assessment 31 January deadline.

My immediate reaction was why/which muppet dreamt up such an idiotic idea? What is the advantage of reporting five times a year instead of once which has worked fine since the mid-1990s under self-assessment (I remember the associated Ken Dodd jokes from that era). If it isn’t broke don’t fix it is the well-known phrase particularly as the new system will cost more and absorb more time for little or no end benefit. MADNESS!!!!!!!!!

The names of the nine people who I listed in my Making Tax Digital post yesterday are unknown to me and their potted career histories all look very impressive (that said I could truthfully say I scored a cup final winning penalty (twice) against France which I am sure would impress any footballers out there especially if I didn’t mention it was in the Maldon Sunday league…I was playing for Springfield Rouge because we had a few on the team who had French GCSE and knew some real French words unlike our opposition).

My problem with the listed people is their record suggests they are not performing the job they are supposed to. They presumably permitted Jim Harra and his cronies to introduce the 30/60 capital gains tax reporting which has recently won the following accolades:

-As the late great tax expert Philip Hardman would have said – the UK property reporting service is a national disgrace!

By Rebecca Benneyworth
27th Oct 2021 16:02
CGT reporting - worst, absolutely the worst thing ever.

If the not so nimble nine had asked Jim Harra about his car crash new CGT reporting it would never have seen the light of day and they clearly failed in their responsibility below:

examining planned changes to ensure that the impact on customers has been sufficiently considered

If the above were football managers they would have lost their jobs and certainly not permitted to carry on unchallenged to introduce an even bigger car crash which MTD for Income Tax will undoubtedly be. Anyone who deals with HMRC will know it is hugely frustrating and to imagine the scrum queuing to find out how this new responsibility will be accomplished is mind-blowing.

I do wonder whether the problem here is this is one big cosy club with everyone telling each other what a spiffing job they are performing. It would be nice to receive a reply from some of those currently in the club to explain how such crap reporting systems managed to slip through their net. And while responding please clarify how a move from 3% successful appeals to…… mind the gap….. 99% successful appeals equates to HMRC treating Taxpayers fairly?

My suspicion is these people are out of touch and have little experience of dealing with HMRC on a daily basis. Get a few rib ticklers like Richard Thomas on board and perhaps things might start to improve (imagining Jim squirming in his chair at that prospect and having to sell the software houses that the party is over).

Anyone disagree?

[etf]

Rebecca Cave's summary copied below (in green type) detailing where the introduction of a new tax system goes wrong. I'm sure CGT was picked randomly as an example. Not quite certain where the not so nimble nine are supposed to step in and:

i) examine the planned changes to ensure that the impact on customers has been sufficiently considered; and

ii) tell Jim to shelve his plans because they will have a negative impact on the sanity of taxpayers.

What should happen
In an ideal world a new tax administration system, say for the reporting and payment of capital gains tax, would come into being something like this:

1) Idea is floated for a new tax or tax collection mechanism.
2) Call for evidence on whether this is the best solution to the perceived problem.
3) Consultation on which of the proposed solutions should be taken forward.
4) Draft primary law and regulations are published for comments.
5) Prototype system is tested by tax agents and taxpayers representing all categories of taxpayers it will apply to, alongside draft guidance.
6) Results from the full testing period are incorporated into the final design for the new system.
7) Final technical guidance and communications to taxpayers are issued simultaneously.
8) New system is launched.

What often happens is step 2 is missed, step 5 is incomplete, and the final guidance appears after the new system is launched. The communications package for taxpayers and agents may also be missing or incomplete, because if HMRC hasn’t written the full guidance how can it design the communications to taxpayers?

[etf]

By kevinringer
24th Aug 2022 12:54
30-day CGT was launched just days into the UK's first ever national lockdown. HMRC were told that we would not be able to sit with clients and hold their hands through the registration/authorisation process but the HMRC steam roller was not for listening. HMRC assured us all that they had piloted the system adequately but like everything else, HMRC had completely failed to engage with the digitally-challenged, or indeed, just normal people because lets face it, who in their right mind would voluntarily sign up for a HMRC pilot? What is in it for them? The shambles that has happened ever since then is the result of HMRC failing to pilot adequately. This is not something confined to 30-day CGT. Look at the new VAT Registration Service launched just a couple of weeks ago. HMRC will make it a hat trick when MTD ITSA starts.

[etf]

Copied from another thread:

By bd6759 » Wed Sep 21, 2022 9:42 am

The meaning of reasonable excuse was explored and dissected by Tribunals with the introduction of HICBC and NRCGT. With expanded case law and a wider interpretation it’s not unexpected that there was a change to the appeal dynamics. More appeals were accepted: it’s understandable and is not a conspiracy. Treating people “even-handedly” does not mean they should be treated the same. What is a reasonable excuse for you might not be a reasonable excuse for me.

If you put as much effort into your understanding of tax law as you do to your indignation if it, you might get a better understanding of the issues you are shouting about.

by etf » Wed Sep 21, 2022 1:26 pm

Thank you for your thoughts on MTD4IT. Hopefully Jim Harra will take note and make an announcement shortly.

I have once again copied below an appeal letter which was successful...the NRCGT penalties were cancelled. With your understanding of the subject matter, are you able to give me an insight into the magic ingredient in that letter (this evidence alone was sufficient for HMRC to make the decision)?

I have successfully appealed against a NRCGT penalty. The wording of my letter was as follows and it was accepted without question:

"Further to your email of 17 June 2016, we write to appeal against the penalty of £800 issued to our client for the late submission of the non-resident capital gains tax return.

The circumstances are as follows:-

Our client has been living in Australia since 2012, during which time he rented out his property. The income has been declared on my client’s income tax return each year.

Due to my client’s absence from the UK, he was unaware of the new rules that came into force on 6 April 2015, requiring the CGT return to be completed within 30 days of the date of sale of the property. Hence, no CGT return was completed when the property was sold in November 2015.

When it came to our attention, the non-resident CGT return was filed without delay. You will see from the return that there is no tax due and therefore there has been no loss to HMRC. Both we and our client apologise for the delay in filing the return but are confident that you will be able to see that it was not a deliberate action.

We trust that, in the circumstances, the penalty can be removed.

In the meantime, our client has paid the amount due and so, if our appeal is successful, we should be grateful if this amount could be refunded as soon as possible."

[bd6759]

Seems that the HMRC Officer took pity on the taxpayer because he had engaged an agent who didn’t understand the law.

[etf]

So, are you now going to backtrack and agree that HMRC has indeed broken the Taxpayers Charter, because the circumstances of that taxpayer mirror a large section of late filers? i.e. HMRC has not treated taxpayers even-handedly.

[bd6759]

If you say so.