Mental health episode is a “reasonable excuse” for late tax return, says HMRC

Mental health episode is a “reasonable excuse” for late tax return, says HMRC

Taxpayers suffering from mental health conditions are likely to be given greater consideration should they file a late tax return, according to a leading tax authority.

The Association of Tax Technicians (ATT) said HM Revenue & Customs (HMRC) has a growing awareness of mental health and “appear to be taking this into account regarding fines”.

Filing a tax return just one minute late will incur an automatic penalty of £100. A recent Tax Tribunal ruling indicated that these fines may be illegal, but for now, the penalties will stick.

The latest figures suggest that around 800,000 people are automatically fined every year – but only those with a “reasonable” excuse will have theirs waived.

What is a ‘reasonable’ excuse and what is not is at HMRC’s discretion, but it said if someone had a mental health condition, such as an episode of depression, they would not ask them to pay a fine.

Michael Steed, president at the Association of Taxation Technicians, said: “This is not something that has happened overnight but HMRC definitely has a growing awareness of mental health and appear to be taking this into account regarding fines. Tax officers can use their discretion to waive fines where they feel there are special circumstances.

“The topic has become a lot more high profile especially after the Daily Telegraph’s interview with Prince Harry. HMRC also don’t want the bad publicity of fining depressed people.

“However if taxpayers become repeat offenders then their patience may start to wear more thin.”

An HMRC spokesman said: “Anyone with a reasonable excuse for filing late won’t have to pay penalty.”

The deadline for filing the Self Assessment tax return is Wednesday 31 January 2018.

Business rates relief fund offers “false hope” to SMEs, says FSB

The Federation of Small Businesses (FSB) has criticised the Government’s £300 million business rates relief fund, amid concerns that hundreds of businesses are still waiting to benefit from the scheme.

Mike Cherry, Chairman of the FSB, has voiced concerns that the initiative has offered “false hope” to many small and medium-sized enterprises (SMEs) who are facing business rates hikes.

Citing the group’s own research, he said that that approximately one in five SMEs were at risk of having to either sell their business or shut up shop when the hikes hit, due to a squeeze on their finances.

Pointing to separate data from property firm Gerald Eve, he added that of a total of £175 million had been allocated to councils under the business rates relief fund for the year to March 2018 so far.

However, despite this, more than £70 million is still yet to be passed on to local businesses, he said.

Mr Cherry said that for many SMEs, “the Chancellor’s £300 million hardship fund [had initially] offered a small glimmer of hope,” but that for most, this had turned out to be “false hope.”

Earlier this month, a survey carried out by the FSB found that British business confidence was waning.

It found that one in seven SMEs were expecting to shrink their business in the coming months, amid concerns that operating costs are on the rise and profitability is falling.