Did you know your client could be landed with a penalty if they fail to tell the Taxman when they become liable to pay tax? For example, when your client became self-employed, or made a large capital gain. The deadline for declaring that your client has income tax or capital gains tax (CGT) chargeable relating to the year to 5 April 2013 is 5 October 2013.
If they miss that deadline, the Taxman may send your client a failure to notify penalty, which can be up to 100% of the tax due. However, if your client pays all the tax due on time, which for income tax and CGT relating to the 2012/13 tax year is by 31 January 2014, the penalty can be reduced to nil.
Where your client has already received a self-assessment tax return form to complete for 2012/13 or a notice to file a self-assessment tax return online, your clients obligation to tell the Taxman is satisfied when they submit their tax return on time. But if your client hasn’t got a tax return form, they need to ask the Taxman to set them up in the self-assessment system before 5 October 2013.
Once your client is registered with the Tax Office, they should receive either a Tax Return form or a letter from the Taxman asking them to file a Tax Return online. The form or letter will include your clients Unique Taxpayer Reference number (UTR). If your client submits a Tax Return that does not include their personal UTR number it may be rejected, and any tax payments your client makes will not be promptly matched to their records.