Please contact us now about your 2024 Self Assessment Tax Return by reply or call Martin on 07967 809 507.

As of the 6th April you can now complete your 2024 Self Assessment Tax Return. Our fixed fee for Self Assessment Tax Returns is ￡300.00 + VAT. (Loyalty discounts apply to existing clients)

HMRC’s Customer Service Crisis?

In March earlier this year, HM Revenue and Customs (HMRC) faced a public relations debacle when it announced the closure of several helplines, only to reverse the decision the next day.

Taxpayers Left Waiting

The National Audit Office (NAO) recently highlighted the severity of HMRC’s customer service issues. According to the NAO, taxpayers collectively spent nearly 800 years (7 million hours) on hold in 2022-23, a staggering increase from 3.2 million hours in 2019-20. Average call waiting times have surged by over 350% in five years, with only 67.2% of callers reaching an advisor in the first 11 months of the 2023-24 tax year, far below the 85% target.

HMRC’s Shortage of Staff

The NAO report attributes HMRC’s declining performance to funding pressures, job cuts, and an over-reliance on digital services. Customer service staff numbers fell by 9% between 2019-20 and 2023-24. Despite spending ￡881 million on customer service in 2022-23, HMRC faced a 6% real-terms budget cut since 2019-20 and was expected to make further savings of ￡149 million annually. This led to plans for a 14% reduction in customer service staff by 2024-25.

HMRC’s Digital Services

While HMRC encourages the use of digital services for straightforward queries, the increasing complexity of tax affairs means many taxpayers still rely on phone support. The NAO report and feedback from tax experts emphasise the need for significant improvements in digital services and the continued availability of phone and postal support.

We strongly recommend preparation of your 2024 Tax Return now so that you have time to deal with any issues that might arise. Contacting us now will also provide us with more time to help you deal with HMRC errors and delays.?

More generally taxpayers often put off preparing their tax return until late in the year. However, this really does not leave very long to file and pay any tax owed before the January deadline. It is much better to get this task done and dusted now as it will allow more time to set money aside to pay the tax bill, to apply for 'time to pay' or to deal with any issues that might arise.

In this post, we highlight the main advantages of filing tax returns early:

Tax payments are not accelerated

Even if you file your tax return early with HMRC, you are only obliged to pay any tax liability by the normal due date:

• 31st July 2024 Second payment on account
• 31st January 2025 (balance and the first payment on account - if applicable);

?...But refunds are accelerated

If you file your tax return before the filing deadline, you should receive any tax refund you are due fairly soon after you’ve submitted it. HMRC do not wait until 31st January to pay you. Therefore, if you suspect you have overpaid tax and are due a refund, you should really prepare your tax return as soon as possible so that you can get the cash earning interest in your bank account... not HMRC’s!

Cash flow management

Filing your tax return and calculating any tax liability arising, allows you the time to start saving for the bill and to manage your cash flow. If you pay your tax bill late, HMRC will charge you interest and possibly even late payment penalties.

The other benefit of filing early is that if your tax liability is under ￡3,000 and you submit your tax return by 30th December 2024, you can opt to have your tax liability collected through your tax code. This means it will simply be deducted from say your wages or pension each week/ month.

Time

If your affairs have changed this year and you have say, losses or a significant amount of additional income, then preparing your return early can pay dividends because it gives you the time to consider any tax planning opportunities which could lead to tax savings.?

Calculating your tax liability now will also assist you in deciding if you should request a deferment of your tax payment:

https://www.gov.uk/difficulties-paying-hmrc?

Furthermore, having plenty of time to prepare your return reduces the risk of errors being made, because you are not rushing to get it finished.? It also allows time for bank statements to be collected and any other financial documents you may need to file the return.

Contacting HM Revenue & Customs

Trying to get hold of HMRC can be pretty difficult at times due to staff cuts, but it’s even more difficult around the tax return deadline. Avoid leaving your tax affairs until December or later; just in case you need to speak with the department and cannot get through.

If you are due a tax refund, you’re also likely to experience a longer turnaround time if you file your return during their peak times.

Penalties

HMRC have tightened the penalty regime for late tax returns, and they are now significantly stricter than they used to be. For example, the initial ￡100 penalty used to be reduced if you paid the tax on time or was capped to your tax liability. However the ￡100 penalty is now automatic and is very difficult to appeal.

If your tax return is more than three months late, ￡10 daily penalties start to accumulate up to a maximum of ￡900. A penalty of the higher of ￡300 or 5% of your tax due is then charged if your return is 6 months late and again if it becomes over 12 months late. All of these penalties are in addition to one another; rather than in place of. This can mean penalties for late tax returns can top over ￡1,600.

Using Gilchrist & Co and contacting us now will take away the stress of filing tax returns and leave you to concentrate on running your business. Not only should penalties and interest be avoided, but we may be able to save or defer you tax. We can also keep you informed of your tax position and abreast of any changes in the tax regime.

Call Martin on 07967 809 507 or email [email protected] to arrange collection of your books now.