Tax  

Six tax tales advisers ought to read

Six tax tales advisers ought to read

As Britain passed the January 31 deadline - no, for filing one’s taxes online, not the other thing, more glaring errors were revealed that could see hundreds of people facing unexpected bills.

In fact, six big tax stories stole the limelight over the past week - all about give and take. Five relating to HM Revenue & Customs taking from Britons, and one story about the taxman giving back.

According to a Freedom of Information request from wealth manager Quilter to the NHS Business Services Authority only 26 per cent of GPs’ pension records for 2017/18 are up to date.

The FOI confirmed that out of 42,451 active practitioner records in England, 11,232 had been updated as of March 31, 2018.

This means more than 31,000 GPs could be at risk of an unexpected tax bill landing on their doorsteps. 

The NHS Business Services Authority stated it could not comment on whether the other 31,219 should have a 2017/18 update or if the record should no longer be active so could not say for definite how many incomplete records there are.

But as Dr Richard Vautrey, chairman of the British Medical Association’s GP committee, said the failure to update pension records meant GPs may be unaware they have breached their annual tax-free allowance on contributions and called these bureaucratic delays “a disgrace”.

This is just one in a long line of concerns for doctors. GPs are still being kept in the dark over how NHS England will pay GPs' pension tax charges this winter and the BMA has written to NHSE calling for urgent reassurances on this.

And problems over the tapered annual allowance’s effect on senior doctors led to clashes between MSPs and the chancellor Sajid Javid.

Scottish health secretary Jeane Freeman called on the chancellor of the Exchequer to find a permanent solution to fix the issue of the TAA impacting NHS doctors, demanding this with “urgency”.

But it's not only our medical professionals facing taxing times from the revenue. Nearly 1m people missed the self-assessment tax return deadline of January 31 and have been fined. 

Taxpayers who missed the deadline will be fined £100 at first and then £10 a day after three months and the greater of 5 per cent of the tax owed, or £300 after six months of not filing the return.

Moreover, warning bells have been sounded over hundreds of taxpayers potentially facing an unexpected tax bill if they retire early due to ill health. 

Insurer Royal London has urged those workers who take early retirement to be wary of breaching their annual allowance for pension tax relief, particularly those in public sector schemes such as teachers or nurses.

Therefore it is with some measure of satisfaction that the sixth big-hitting tax story we reported on was the news that thousands of people who had been charged emergency tax when they withdrew money from their pension have now been repaid.