Recently I got late penalty letters from HMRC saying I have £1,716.15 overdue.
I understand I cannot avoid my late penalties. (If there is a way to appeal for penalties, do let me know
I am writing to consult all of the experts here to see if I can reduce the part where the penalty is subjected to tax I actually need to pay.
If you're ready, please read on.
In mid-2013/2014 (I can't even remember now, I think it is 2014),
I've set up self assessment as I was planning to take some freelance work.
I did not take any freelance work and shortly after I've set it up I moved.
After I moved, I forgot to change my address and I didn't receive any HMRC letters.
From 2013-2014 I was in full time employment and the income tax was already taken from PAYE.
From sept 2014 - sept 2015 I was in full time postgraduate study.
I was in part time work sept-dec 2014, which I earned £1200.
(I didn't change my address as I was working in the same place since Jan 2014.)
I took one contractual work which I earned £180.
(I reported my new address and NI number to the HR)
To sum up I did not earn more than £11,000 (i.e. tax allowance) that year.
Recently in March 2016 I started full time employment and got my first payslip.
Soon after I got letters from HMRC saying I have £1,716.15 overdue.
When I checked online I see the below:
2013 to 2014 tax return Overdue
2014 to 2015 tax return Overdue
2015 to 2016 tax return due by 31 January 2017
Pay now to avoid further penalties.
I understand £1,716.15 because penalties charges are £100 + £300 (6 months late) + ££300 (12 months late)
From online research I can see there's an item which says "Up to £900 (90 days at £10 a day from 3 months late)"
However to my understand this amount is subjected to the amount of tax I owe.
So does that mean I can pay less?
I did not earn over £11000 in 2014-2015 so I don't think I am subjected to income tax.
I was in full time employment already in 2013-2014 so I think I've paid my taxes.
Please do correct me if I am wrong in anyway! As you can see I am a tax/finance/bookkeeping newbie and I would love to have any suggestions/comments on this issue!
Thanks so much for reading and I hope to hear from you all soon.