Taxpayers asked to pay same simple assessment twice
Some taxpayers have been asked to pay the same tax bill twice after HMRC sent paper copies of simple assessments that had already been paid.
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Richard is the editor of AccountingWEB. If you have any comments or suggestions for us get in touch.
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The duplicate Simple Assessment is the result of a change of policy, but HMRC have a long history of causing confusion without changing policy. Just look at SA302 which HMRC still insist on issuing every time they process a Marriage Allowance claim. Most clients think an SA302 is a bill and can get very distressed because the SA302 no longer shows payments on account already made. Indeed, sometimes the payments on account can result in an overpayment. I've lost count of the hours I've wasted having to explain to clients why the SA302 does not show the actual tax liabilities.
Though clients mistake SA302 for SA demands, HMRC don't make the actual SA demands any more comprehensible. HMRC has had over 25 years to make them more understandable, but they're as incomprehensible today as they were when they were launched. I sometimes wonder if HMRC go out of their way to make them as incomprehensible as possible.
I spend hours explaining them too. It is unhelpful to say "We have made amendments to your return". It looks as though we have cocked up.
Kevin
The issue of duplicate simple assessment notices is not a simple (pun intended) or excusable change of policy – had it been there would have been no need to issue the paper form.
Richard’s post links to the ICAEW website and reflects what is said there:
“Between May 2021 and July 2022, taxpayers who had opted for paperless communications from HMRC received their simple assessments (PA302) digitally via their personal tax account.
It was not clear that this digital notification satisfied the legislative requirements. This has now been rectified. From 6 April 2023, simple assessments can be served digitally.”
I assume this is what HMRC told the ICAEW and not their own view. I have already been in touch with HMRC about this and can tell you that it was crystal clear to me and must have been to HMRC that they had no legislative foundation whatsoever for issuing simple assessments electronically to a secure mailbox.
The Income and Corporation Taxes (Electronic Communications) Regulations 2003, as they stood in 2022 said:
“2 Scope of these Regulations
(1) These Regulations apply to--
(a) the delivery of information, to or by the Board, the delivery of which is authorised or required by or under--
(i) any provision of section 8, 8A, 8B, 9, 9ZA, 9ZB, 9A, 9B, 9C, 9D, 12AA, 12AAA, 12AB, 12ABA, 12ABB, 12AC, 12AD, 12AE, 28A, 28B, 28C, 30B, 59C, 59DA, 59E or 100 of the Management Act,
3 Use of electronic communications
(1) The Board may only use electronic communications in connection with the matters referred to in regulation 2(1) if—
(a) the recipient has indicated that he consents to the Board using electronic communications in connection with those matters; and
(b) the Board have not been informed that that consent has been withdrawn.”
Note that the list does not include sections 28H, 28I and 28J TMA, so it cannot be the case that it was possible to do what HMRC did. The notices were therefore not delivered to the taxpayers and no proceedings could be taken by HMRC in relation to them.
The change made was a legislative one. The Income and Corporation Taxes (Electronic Communications) (Amendment) Regulations 2023, coming into force on 6 April 2023 added sections 28H, 28I and 28J to the list in regulation 2(1)(a)(i) of the 2003 Regulations. So by saying that HMRC “can” be served digitally from that date HMRC are giving the game away – it means that before 6 April 2023 they could not in law, not that it was unclear whether they could or not.
The Explanatory Memorandum to the 2023 Regulations repeats the untruth:
“Why is it being changed?
7.3 The Income and Corporation Taxes (Electronic Communications) Regulations 2003 did not clearly stipulate that Notices of Simple Assessment and Notices of Daily Penalties can be digitally made, delivered and (where appropriate) formally withdrawn. In order to support those who wish to receive such communications digitally from HMRC, this Statutory Instrument will amend the 2003 Regulations so that they apply to Notices of Simple, and other Assessments, withdrawals of Simple Assessments and Notices of Daily Penalties.”
Despite my emailing the person whose name and email address is given at the end of the EM, HMRC refuse to change the EM or enter into any correspondence, so I am contemplating a complaint and a FOIA request.
And that is not all of the problems with the regulation and the EM. They slipped in a new reference to s 30A TMA which covers all assessments which are not self-assessments. But there is absolutely nothing in the EM which covers this extension.
They also included a reference to paragraph 4 Schedule 55 FA 2009 (daily penalties for failure to file a return). This can only in the context refer to the notice that is required under paragraph 4(1)(c) of that Schedule, as assessments of penalties were already covered. But the EM does not seem to know the difference and is wholly misleading.
This I am afraid is par for the course with HMRC now. The amount of backside covering and failure to admit any kind of error or to apologise is embarrassing for a former employee.
Note also that there is nothing in the regulations covering Schedule 2 FA 2019 (60-day CGT returns and assessments).
Almost everything to do with HMRC is not fit for purpose!
Just today trying to get a colleague access to all our clients on our agent account.
You would think there would be a tick box so that you could add all clients or one or three. NO you have to do it individually!
You would think there would be the name of the client next to their reference (UTR, PAYE) - NO! so you don't even know who the client is without going back and looking in your other systems
If you wanted to design a system that was completely and utterly substandard to the user here it is.
"Simple assessments were given the all-clear to be served digitally from 6 April 2023"..
Is there a separate alert that one has been issued? Most of my clients do not check their tax account regularly.