This week we bring you news about HMRC letters to agents about a potential discrepancy on 2021/22 self-assessment returns, and HMRC has moved the Check Employment Status for Tax tool on to a new platform. The guidance on how remove a taxpayer from the self-assessment regime has been enhanced with two new videos and it is now possible to apply online to join the VAT flat rate scheme. The latest News and Information Bulletin from HMRC is also available which includes a reminder about the planned outages from 6-9 November because of IT upgrades, which we told you about last week.
Potential 2021/22 self-assessment discrepancies project
We are aware that from early October 2023, HMRC began sending letters to agents about potential discrepancies between their clients 2021/22 self-assessment return when compared to the P11D and P14 forms submitted by employers or child benefit information held by HMRC. The letter does not mention specific clients but advise the agent that HMRC will be in touch within three weeks (unless the agent contacts HMRC first) to share details of the clients where there are potential discrepancies.
According to the letter, if there are any discrepancies, as long as an amendment is made by 31 January 2024, HMRC will not charge a penalty. However, if no voluntary amendment is made by then, HMRC will review and consider making a discovery assessment and charging a penalty. Where an amendment results in an underpayment of tax, interest will apply from the original due date. A late payment penalty may also be payable.
HMRC’s aim is to resolve these cases in advance of the 31 January 2024 online filing deadline for 2022/23 self-assessment returns.
Check Employment Status for Tax
HMRC recently moved its Check Employment Status for Tax (“CEST”) tool to a new platform. The move has not resulted in any changes to the questions asked however users of the tool can now review the answers to their questions after each section. In addition, guidance from HMRC’s employment status manual is now embedded in CEST.
Removing a taxpayer from self-assessment
HMRC has recently launched two new YouTube videos explaining the online process for taxpayers to stop self-assessment:-
If a taxpayer believes they no longer need to complete a self-assessment return for 2022/23, it is important that they take action before the 2022/23 online filing deadline of 31 January 2024 in order to avoid being charged a penalty.
Apply online to join VAT flat rate scheme
HMRC recently launched a new online form which should be used by businesses to apply to join the VAT flat rate scheme (a scheme that simplifies VAT accounting for businesses with an annual turnover of no more than £150,000). Applications can still be made by post.
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