1 May 2012 sees one of the biggest changes in taxation policy which affects small businesses. It’s had some publicity but not as much as I thought it may. Perhaps it’ll get a bit more press coverage when the bills start to land on people’s doorsteps.
The change is the introduction of automatic £10 daily penalties from 1 May for tax returns due in by 31 January 2012. The penalty is for a maximum of £900 before another tier starts. In the past HMRC were able to apply for a £60 daily penalty but in practice it rarely happened. In 20 years I can only recall it been threatened once.
HMRC claim the new rules are all about getting tax returns in rather than increasing their revenue through fines. I half believe them. What is certain is that some of the clients I’ve helped over the years would simply have been unable to pay these new penalties.
The message clearly needs to be to get tax returns done on time and not put your head in the sand.
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