Tax amnesties are like buses – you wait for ages and then a group of them come along all together. Hot on the heels of the Tax Catch Up Plan (aimed in particular at those involved in teaching and lecturing) and the Electricians Tax Safe Plan, we now have the Tax Return Initiative (TRI). This is rather more interesting than its predecessors in that it is aimed at all those who have been asked to submit tax returns but have failed to do so – indeed it has already been dubbed “the self-assessment amnesty”.
The TRI runs from 3 July until 2 October 2012 and is designed to provide those with outstanding tax returns for 2009/10 and earlier years with a chance to catch up at reduced cost. There is a simple three-stage process:
- Advise HMRC that you wish to take part in the TRI
- Complete and submit the outstanding tax returns
- Pay the tax due
Eligible participants will still face late filing penalties plus interest and surcharges on the outstanding tax but tax-geared penalties will be calculated on the “best terms available”. As usual, there is a stick to accompany the carrot – after 2 October, HMRC will use its full powers to pursue those with outstanding returns and/or tax with penalties of up to 100% of tax due and the threat of criminal proceedings.
There are circumstances in which you will not be able to participate in the TRI and situations in which it might not be the best deal on the table. However, disclosure of some sort is the only route to certainty in respect of your tax affairs. If you have outstanding returns or have under-declared (or failed to declare) income or gains for any tax year, we can advise you how to achieve the right result with HMRC.