HMRC podcasts on new penalty policies for tax returns

Her Majesty’s Revenue and Customs (HMRC) has launched podcasts explaining what help and guidance people can get on the new penalty regime for tax errors.

The new penalties system is designed to be simpler and fairer because HMRC said it recognised that most people take care to fill in their tax returns correctly.

Under the new system, if a person takes reasonable care to get their tax right, they will not be penalised if HMRC realises an unintended mistake has been made.

“We use penalties to stop people who don’t take care from gaining an unfair advantage,” HMRC said.

The free podcasts discuss what HMRC means by 'reasonable care’. This includes keeping accurate records to make sure your tax returns are correct, checking what the correct position is when you don’t understand something and informing HMRC promptly about any error the person filing the return discovers.

The new penalties apply initially for periods starting on or after 1 April 2008, that are due to be filed on or after 1 April 2009. Initially the system will cover Income Tax (including Self Assessment), VAT, employers paying PAYE, National Insurance contributions, Corporation Tax, Capital Gains Tax and the Construction Industry Scheme.

However, any returns that for the 2007-08 tax year, such as Self Assessment returns, are subject to the existing penalties.

Brian Redford, Director of HMRC's Agents & Employers Service Improvement Programme (AESIP) also outlines what practical help is available if an agent, such as an accountant, financial advisor or individual files an incorrect return. He also talks about how his team are working to improve services.

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