NEWSFLASH 19 June 2018 – What Is A Simple Assessment?

The aim of a Simple Assessment is to reduce the number of taxpayers in self assessment via a form PA302. This will be a paper based system (even if the taxpayer has opted to go paperless) and will be copied to agents. The tax will be due by 31 January or 3 months after the issue of a tax return if raised after 31 October.

There is a right of appeal and starting from September 2017 this will affect individuals subject to PAYE where tax cannot be collected through a payroll. It will also affect individuals whose only source of income is the state pension.
At this precise time, further rollout has been halted but new triggers have been developed to ensure that the correct amount of tax is collected each tax year. One trigger which is not currently live is where HMRC identify where the employer is using the incorrect PAYE code to that issued by HMRC.

BANK & BUILDING SOCIETY INTEREST (BBSI)
Actual 2017-2018 BBSI was received by HMRC for the 2017-2018 tax year which they will use to estimate interest for the following tax year and populate PAYE codes for the 2018-2019 tax year.

It is up to the taxpayer to check that the BBSI figures are correct. Joint account holders which are not in self assessment who have interest which is more than the savings allowance should report it to HMRC. Taxpayers already in self assessment should report as normal.

DYNAMIC CODING
This was introduced in July 2017 and HMRC began using monthly real time information from data provided by employers to automatically adjust PAYE codes for employees during the tax year. This was intended to reduce the number of employees with over/under repayments during the tax year.

Under dynamic coding, HMRC estimate an employee’s income for the tax year by taking details of the earnings reported for the period to date and using this as a basis for the complete tax year. This does not of course take into account changes such as bonuses etc which can lead to incorrect estimated income.

So very recently HMRC have issued a statement requesting additional time to resolve such problems and dynamic coding is currently on a pause.

 

If you would like our help to understand the implications in more detail for your specific situation, call us today on 02392 449732 or click on the ‘Request Call Back’ button below and we will be happy to have a chat.

 

Request Call Back

 

 

 

If you have found this article useful, please share on Social Media using the buttons below.

This is Vicky, signing out for now and remember – Behind every good business is a GREAT Accountant!

 

 

 

Contact Us

Posted in Tax & Accountancy.

Leave a Reply

Your e-mail address will not be published. Required fields are marked *