Evan did not receive a tax return for 2010-11 but he was aware that he had income which had not been assessed to tax. He notified HMRC of this fact on 2nd October 2011 and a return was issued to him on November 15th 2011. He completed the return and sent it back with the necessary payment on April 7th 2012.
Required:
Explain the penalties, surcharges and interest which Evan might be required to pay.
Nathans income tax liability for 2009/10 was £18,000. He had suffered tax by deduction at source of £6,000 and paid two payments on account of £6,000 each on the due dates.
He submitted his 2009/10 return on 31 January 2011 and made a claim to reduce his payments on account for 2010/11 on the basis that his total liability for 2010/11 would be £14,000 with tax suffered of £5,000.
He made the payments on account of £4,500 on 28 February and 31st August, 2011.
Finally, on 31st March 2012 he submitted his return for 2010/11 which showed a total tax due of £17,000 and tax deducted at source of £4,000. He paid a further £4,000 on 31st March 2012.
Required:
Calculate the charges and interest on any overdue tax chargeable in respect of Nathan's tax payments for 2010/11. (Assume HMRC interest rate of 3%)