The Tax Catch Up Plan – an overview for 2012
The Tax Catch Up Plan – an overview for 2012
The Tax Catch Up Plan (“TCUP”) is a campaign by HMRC which is aimed at (but not limited to) tutors and coaches who have been paid for their work but have not declaring this income to HMRC or settled their tax liability.
The timeline is as follows:
10 October 2011 onwards:
- Notify HMRC that you wish to take part in the TCUP
- Disclose to HMRC all income, gains and tax not previous disclosed
- Make a formal offer to HMRC
6 January to 31 March 2012:
- Pay the tax that you owe to HMRC – you may be able to do this by instalments
- Assist HMRC with any further questions they may have with regard to your disclosure
31 March 2012 onwards
- HMRC will review all taxpayers in this sector who have not taken advantage of the TCUP and identify those it believes should have signed up to the TCUP
Individuals who have signed up to the TCUP will benefit from reduced penalties rates from HMRC of 0%, 10% or 20% -- the rate will depend on why income was not previously disclosed.
What happens if you haven’t told HMRC by 6 January 2012?
If you have not notified HMRC that you intended to disclose your tax liability before 6 January 2012, you can still do so but it will not be under the TCUP. If you do this voluntarily, you are more likely to reduce any penalties that may be due and it gives you the opportunity to get your tax affairs in order.
What happens if you never tell HMRC?
If you do not tell HMRC of any undeclared income then it will be treated very seriously. HMRC has extensive legal powers to obtain information and identify those who have failed to declare income and pay the right tax. You must tell HMRC of any outstanding tax liabilities as the result could be either a heavy penalty or, in severe cases, a criminal prosecution.
Morton Fraser’s tax team can assist you on any aspect of the TCUP, disclosing any undeclared income to HMRC or with your tax affairs generally.
For further advice, please contact Sarah McKinlay, Partner at Morton Fraser on sarah.mckinlay@morton-fraser.com or 0131 247 3150.
