Tax Returns – Who Should be Filing Them?
22/06/2010
It is well known that individuals with untaxed income, the self-employed and directors of companies must all file Tax Returns annually to H M Revenue and Customs (HMRC).
It is not well know however, that those individuals, who do not fall into the aforementioned categories, may still be required to file a Tax Return if their total annual income from all sources (including benefits in kind) exceeds £100,000. This rule may therefore trap individuals who have very simple tax affairs e.g. PAYE income only.
Although HMRC have had this rule in place for a few years now; it has not been well implemented, with most people who have not completed Tax Returns having no knowledge of their requirement to do so.
It is clear from HMRC's guidelines that it is the individual's responsibility to register and there are penalties for not abiding by the rules.
It is expected that HMRC will become more stringent on enforcing this rule in view of the personal allowance taper for 2010/11 for those with total income over this limit so it is important that you consider whether you may be affected.