Taxpayers hit by HMRC hold-up

Around 500,000 people who complete self assessment tax returns will have to wait longer than normal to find out how much tax they have to pay, HM Revenue & Customs (HMRC) has announced.

Some of the self assessment statements due to be issued in July will now be issued later, HMRC announced on 25 July, although it said most would be sent on time. People with a unique taxpayer reference number ending with digits from 70 to 99 may be affected.

HMRC usually tells people in the self-assessment system – mainly sole traders, the self-employed, and partners in businesses or limited liability partnerships – who have to pay tax "on account" that they should make two estimated tax payments, one by 31 January and the other by 31 July.

They make the payments based on tax paid in the 2009-10 tax year. A balancing payment, or refund, will then be made in January 2012 to resolve any differences between the estimate and the actual amount.

HMRC said around 500,000 customers would receive their July statements later than normal, adding: “If HMRC has asked you to make a second payment on account in July, you normally have to pay this by 31 July. If you receive your statement in August, you should still pay the tax due as soon as you can.

“You’ll only be asked to pay interest on the tax due on the second payment on account if you still haven’t paid it more than 30 days after you receive your statement. Online customers will still be able to check their statement online and pay online too.”

In January 2008, a similar number of taxpayers received their statements late. HMRC said it had since changed its forecasting arrangements and these had worked well but added: “The volumes on this occasion have risen out of all proportion to previous patterns. HMRC will now ensure that they understand the reasons for this and will be fully prepared for any future rises.”

The BBC and other media have reported that HMRC failed to order enough special paper on which to print the statements.

LINK: Self assessment statements