Self-assessment

Since the introduction of self-assessment in 1997, I have noticed a considerable shift in the focus and energies of tax officials

Rather than spending time calculating people’s tax liabilities, they have increased their efforts in checking up on people and trying to uncover tax evasion.

There has been a recent development, which we are closely monitoring for surveyors. HM Revenue and Customs (HMRC) announced in January a new campaign targeting professionals.

First under the microscope are medics, who are being offered a reduced penalty of 10% to come forward and voluntarily disclose (by 31 March 2010) any income omitted from their past tax returns.

This appears attractive, as penalties can normally be as much as 100% with 
the additional possibility of criminal prosecution. It is expected that the amnesty may soon extend to other professions, such as surveyors, accountants and lawyers. Keep an eye out on HMRC’s website – www.hmrc.gov.uk – or ask your accountant.

Take extra care when completing your tax return. Do not be tempted to leave something off because it doesn’t seem very much as this could result in an enquiry at a later stage.

Remember, if you have missed something on a return you have submitted you can easily amend it. HMRC 
are generally sympathetic when taxpayers disclose errors voluntarily.

Steve Foster is principal at Shipleys LLP

To read more Practice advice, click here