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Principles of Tax > Administration of tax > Flashcards

Administration of tax Flashcards

1
Q

When must an individual liable to IT or CGT notify chargeability by?

A

Before 5th October following the end of the tax year.

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2
Q

How long do HMRC have to amend obvious errors?

A

Within 9 months of filing date.

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3
Q

How long does the taxpayer have to amend a return for obvious errors?

A

Within 12 months of the later of:

  • 31 Jan after end of tax year
  • 3 months after issuement
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4
Q

When should employers report to HMRC?

A

Every time a payment is made to an employee

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5
Q

What is the FPS?

A

Full Payment Submission - payroll software

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6
Q

When should FPS be submitted?

A

On/before payday

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7
Q

When should employers pay PAYE and NICs?

A

22nd of the month following the payroll month.

E.g. 31st March payday, 22nd April pay PAYE and NIC

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8
Q

What is the P11D form?

A

End of year form recording details of benefits provided to employees

Pay by 6th July following end of tax year

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9
Q

What is the P60 form?

A

End of year form recording details of gross pay, tax deductions and NICs for employee and employer

Due 31 May following tax year end

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10
Q

What is the P45 form?

A

Particulars of employee leaving: tax code, gross pay to date, tax and NICs deducted.

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11
Q

How long does it take penalty points accumulated to expire?

A

2 years unless a threshold has been reached

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12
Q

How can a business reset its points to 0?

A

When all VAT returns have been submitted on time and all VAT returns in the last 2 years have been submitted

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13
Q

When can non-deliberate VAT return errors be corrected?

A

On the next return providing it doesn’t exceed £10k or 1% of net VAT turnover

IN THE TABLES

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14
Q

How long must a record of Corporation tax be kept for?

A

6 years from end of accounting period

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15
Q

When must HMRC give notice by to conduct an enquiry?

A

First anniversary of the actual submission date or the quarter day following the first anniversary

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16
Q

When can HMRC make a discovery assessment?

A

If full disclosure has not been made by the taxpayer

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17
Q

When are the submission dates for personal self-assessment tax returns?

A

IN THE TABLES

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18
Q

When are the payment dates or income tax?

A

IN THE TABLES

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19
Q

How are balancing payments calculated?

A

Add:
Income tax
Class 2 NIC
Class 4 NIC
CGT

Less:
POA
Tax paid under PAYE

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20
Q

How are payments on account (POA) calculated?

A

1/2(IT + Class 4 NIC) paid under self assessment for the previous year

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21
Q

What’s the best way to display dates?

A

USE A TIMELINE

22
Q

What are the penalties for late filing of a self-assessment return?

A

IN THE TABLES

23
Q

What are the penalties for late payment of a self-assessment return?

A

IN THE TABLES

24
Q

When must new companies give notice to HMRC about a return?

A

3 months after start of their 1st accounting period (source of taxable income)

25
Q

When must companies notify HMRC about taxable profits?

A

Within 12 months of the end of an accounting period

26
Q

When is the submission date for a full CT return (CT600)?

A

Within 12 months of the end of the period of account

27
Q

How long do companies and individuals get to amend a return?

A

Within 12 months of when the return should have been filed

28
Q

When can companies claim for overpayment relief?

A

Within 4 years of the end of the accounting period?

29
Q

How are companies taxed for late filing of CT?

A

IN THE TABLES

£100 or £200 fixed

Bottom 2 in addition to this

Persistent failure - late 3 times running

30
Q

What are the penalties for late PAYE returns/submissions?

A

IN THE TABLES

31
Q

When is the due date for the filing of a VAT return and paying VAT owed?

A

7 days after the month following the end of the return period

IN THE TABLES

32
Q

What are the penalties for late submission of a VAT return?

A

IN THE TABLES

33
Q

What are the penalties for late payment of a VAT return?

A

IN THE TABLES

34
Q

When is a taxpayer classified as careless?

A

Taxpayer hasn’t taken reasonable care in completing the return

35
Q

When is a taxpayer classified as Deliberate but not concealed?

A

Deliberately made an inaccurate return but not concealed it

36
Q

When is a taxpayer classified as Deliberate and concealed?

A

Deliberately made an inaccurate return and made an effort to conceal it

37
Q

What are the penalties for failure to notify chargeability?

A

IN THE TABLES

Done on PLR, tax individual first

38
Q

What must an inaccurate return result in for a penalty to be charged?

A

Understatement of tax liability or…

False/increased loss for taxpayer or…

False/increased repayment of tax to taxpayer

39
Q

What are the penalties for an incorrect return?

A

IN THE TABLES

Done on PLR, tax individual first

40
Q

How long must records of IT and CGT be kept?

A

Business - 5th year of 31st Jan following end of tax year

Other - 1st year of 31st Jan following end of tax year

41
Q

How long must a record of VAT be kept?

A

6 years

42
Q

When may HMRC send out a short return?

A

Sent to non-director employees, pensioners/sole traders

> £85k turnover

43
Q

How are tax returns dealt with for partnerships?

A

Income and gains reported to HMRC for checking against individuals’ returns

Return submitted same way as individuals return.

Partners taxed on their share of profit.

44
Q

What are the time limits for HMRC to make a discovery assessment?

A

Not careless or deliberate - 4 years

Careless - 6 years

Deliberate - 20 years

45
Q

What can a taxpayer appeal against?

A

HMRC Request

Amendments to self assessment

Discovery assessment

Vat assessment

Penalty

Appeals must be made within 30 days

46
Q

If IT and NIC is <1.5k a month when are payments due?

A

Quarterly

47
Q

When are POA not required?

A

Liability <1k
<20% of previous year tax and NI

48
Q

How are balancing payments of less than 3k collected?

A

Via following year PAYE

49
Q

Can a tax payer appeal against and apply to postpone the tax due under an assessment raised as a result of an equiry into a return?

A

Yes

50
Q

When can a VAT error not be corrected in the next return?

A

If the error exceeds £50k

51
Q

How are late POA and balancing payment dealt with?

A

All liable to interest

Only balancing payments liable to a penalty

Principles of Tax (14 decks)

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