HMRC has a number of legacy computer systems, which don’t always talk to each other effectively. This has caused problems with class 2 NIC liabilities disappearing from taxpayers’ records, as we reported in our newsletter on 8 December 2016.
A work around invented by HMRC staff is to issue a temporary NI number for the taxpayer, so class 2 NIC can be paid alongside his SA income tax liability. However, in some cases the temporary NI number has triggered the creation of a duplicate UTR number for the taxpayer.
When the taxpayer’s 2015/16 tax return was submitted only one of their UTR numbers recorded the receipt of that return, so the HMRC computer has issued a late filing penalty for the other duplicate UTR number. What a mess! Your only option is to appeal against the incorrect penalty notice.
The HMRC computer also has its calendar in a knot. The £100 late filing notices for 2015/16 SA returns should have been dated 22 February, but were actually dated 15 February, and did not arrive with taxpayers until early March. If we have only just received a penalty notice for our client, we can submit a late appeal. A mistake by HMRC in the detail of the penalty notice – such as with the issue date, should be accepted as a reasonable excuse of making a late appeal.