In HMRC

January is traditionally a time of year when contracting professionals working via Umbrella Companies look upon their self-employed freelancing counterparts with a mixture of sympathy and relief: Umbrella Employees, taxed as they are on a PAYE basis, are pleasantly grateful that they will be spared the annual nightmare of the Self Assessment Tax Return.

But in feeling a little sorry for their self-employed colleagues, it’s occasionally possible to enjoy a little chuckle over some of the more imaginative excuses they come up with when they fail to complete their returns in time. The HMRC recently released some of the more creative reasonings that some individuals gave for not filing. Here are some of the best from last year:

  1. I couldn’t file my return on time as my wife has been seeing aliens and won’t let me enter the house.
  2. I’ve been far too busy touring the country with my one-man play.
  3. My ex-wife left my tax return upstairs, but I suffer from vertigo and can’t go upstairs to retrieve it.
  4. My business doesn’t really do anything.
  5. I spilt coffee on it.

There are also a range of dubious attempts to claim expenses for certain items that are almost guaranteed to raise an official’s eyebrow. Such as:

  1. I needed a three-piece suite so that my partner has somewhere to sit on while I work on my accounts
  2. A bill for drinks at a Glasgow nightclub to celebrate a birthday
  3. Fees for veterinary treatment of a pet rabbit
  4. Hotel room service for prosecco and candles
  5. 250 days’ worth of meal expenses comprised of £4.50 per day for sausage and chips

Needless to say, each of the above was given rather short shrift by HMRC officials and rejected.

On a more serious note, the HMRC’s Director General of Customer Services, Angela MacDonald, said that while the more outlandish excuses would be rejected, genuine reasons would meet with more sympathy. She was also critical of the more outlandish expense claims, noting that it was unfair to expect honest taxpayers to foot the bill for other people’s bogus expenses.

The deadline for submitting the 2016-17 Self Assessment tax returns (plus payment for any tax owed) is 31st January 2018. For people who submit returns late and have no legitimate reason, the following penalties will apply:

  • A fixed penalty of £100, even if no tax is owed
  • Additional penalties of £10 per day for returns over three months late, rising to a maximum of £900
  • An additional penalty of five percent of the tax owed or £300, whichever is the greater, after six months
  • A further five percent/£300 after 12 months
  • Further penalties of five percent of the tax owed at 30 days, six months and one year
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