Fast track to UTR not available, but pay the tax anyway to avoid a penalty
HMRC is not able to offer a fast track service this year for issuing UTRs or faxing 64-8s, but it has told us what can be done instead. It has also recently updated its 31 January deadline guidance pages for agents.
No UTR?
There is no fast-track process this year for issuing UTRs. If a taxpayer does not have a UTR (10 digit unique taxpayer reference), there is no requirement to file by 31 January. The taxpayer should first register for self assessment (SA) by sending either form SA1 or CWF1, as appropriate, to the Central Agent Authorisation Team (CAAT). We know from member comments that there seem to be long delays in issuing UTRs and, through Working Together, we have asked HMRC to address this as a matter of urgency.
When the UTR is issued, the taxpayer will be sent a Notice to File which will state the filing deadline, which is two months for filing on paper and three months for online filing.
See also our separate item on overseas partner and partnership UTR issues.
But what about late filing penalties?
Where taxpayers have taxable income for the year 2008/09, they should have registered for SA by 6 October 2009. Otherwise they may face a penalty for ‘failure to notify’. This penalty can be reduced to zero by paying the tax due by 31 January 2010. As explained below, HMRC can accept payments from those who do not yet have a UTR.
How to pay
Where a client does not have a payslip, but wishes to pay by cheque, the agent can download form SA 361 and send the completed form to HMRC with the cheque. HMRC asks that agents do not include a covering letter. [Note - in a an update to this news item, HMRC has told us that in this particular instance it would like to have a covering letter - see the Tax Faculty comment below this article for details.]
Those taxpayers who do not yet have a UTR, but who wish to pay the tax to avoid a late notification penalty, should write ‘new taxpayer’ in the box for the UTR. We have asked HMRC whether those without a UTR may send electronic payments with ‘new taxpayer’ in place of the UTR and have been told that they would prefer paper in these cases.
As we have reported previously, cheque and electronic payments may be sent to either Shipley or Cumbernauld. Wherever possible HMRC prefers electronic payment, see How to pay Self Assessment.
Forms 64-8
As a result of fraud attempts, HMRC has changed its procedures for processing form 64-8. Our item HMRC tightens the procedures for form 64-8 explains the changes. HMRC is not offering a fax facility this year, but aims to process the forms for SA taxpayers within 24 hours. Those for non SA cases will take longer.
Why are there no fast track procedures this year?
Feedback to HMRC on last year’s fast-track facility was that it was useful, but needed to be extended and improved, for example, by including those who needed to be within SA, but who were not self-employed. Unfortunately, this improvement would have required resources to be switched from other work areas. The SA registration process is a key element for keeping fraudsters out of the SA system and, as noted above, there is anyway no requirement for those without a UTR to file by 31 January. In view of this, HMRC decided not to provide a fast track UTR service this year.
In addition, because CAAT now aims to process 64-8s for SA cases within 24 hours of receiving them, HMRC is not providing a fax service this year. Last year it ran a faxing service for forms 64-8 for those agents who were experiencing delays when they had sent a paper form to CAAT. Some agents used the fax service as an alternative to post which was not the intended use of the service and this, together with the 24 hour turn round of 64-8s for SA this year, means that the service has been withdrawn.