A fair taxation system?

[Ruprect]

Last month, 2 months before it was due, I filed my tax return for tax year 06-07. I did this online and the calculation was immediately available, and I owed 5K tax, as I had expected. I paid this promptly like the good taxpayer I am.

This week I received a letter from Hector saying that he had received the 5K for 06-07 and that I owe 2.5K for 07-08, due on 31st January. I rang the number on the letter and spoke to hector’s minion somewhere north of Hadrian’s wall. I said that as we were still in the 07-08 tax year that I do not know how much my liability for this year is going to be. She said that the amount due is 50% of an estimate of next year’s liability based on the previous one; and that this tax is due. I said that when I budgeted for the year, that I included the amount of tax I expected to pay for 06-07 and not that plus 50%.

She said that I can reduce the estimate of next year’s liability, however if I do that and then it is subsequently higher, that hector will charge me interest on the difference between the estimate and what I actually have to pay, at an interest rate of 8%. I asked how this is justified at all, and how they can subsequently charge 8% when the BOE base rate is at 5.5%. At which point I got the age old “I don’t make the rules” statement.

Anyone else think that this is a feccing liberty? Another way that Gordon Brown makes life for small business owners difficult. Thanks Gord.

[Cooperinliverp00l]

Don't pay. Power to the people !

[threaded]

By definition a taxation system cannot be fair.

Give unto Ceaser what is Ceasers.

[ChimpMaster]

Vote with your feet - I will be as soon as I can get out of this craphole of a country.

[oracleslave]

Vote with your feet - I will be as soon as I can get out of this carphole of a country.

What is stopping you?

[cailin maith]

Last month, 2 months before it was due, I filed my tax return for tax year 06-07. I did this online and the calculation was immediately available, and I owed 5K tax, as I had expected. I paid this promptly like the good taxpayer I am.

This week I received a letter from Hector saying that he had received the 5K for 06-07 and that I owe 2.5K for 07-08, due on 31st January. I rang the number on the letter and spoke to hector’s minion somewhere north of Hadrian’s wall. I said that as we were still in the 07-08 tax year that I do not know how much my liability for this year is going to be. She said that the amount due is 50% of an estimate of next year’s liability based on the previous one; and that this tax is due. I said that when I budgeted for the year, that I included the amount of tax I expected to pay for 06-07 and not that plus 50%.

She said that I can reduce the estimate of next year’s liability, however if I do that and then it is subsequently higher, that hector will charge me interest on the difference between the estimate and what I actually have to pay, at an interest rate of 8%. I asked how this is justified at all, and how they can subsequently charge 8% when the BOE base rate is at 5.5%. At which point I got the age old “I don’t make the rules” statement.

Anyone else think that this is a feccing liberty? Another way that Gordon Brown makes life for small business owners difficult. Thanks Gord.

It's called Self Assessment..... been around for years...
For one thing didnt you check out about it before you left paye and for another has your accountant not explained it?

[ChimpMaster]

What is stopping you?

Family commitments, the need to build up a good enough financial fund, balls, but probably mostly the fact that I am too specialised and can't get a similar job that easily. Would love to work in Dubai for a while and then Canada.

[Ruprect]

It's called Self Assessment..... been around for years...
For one thing didnt you check out about it before you left paye and for another has your accountant not explained it?

I've been doing self assessment for years...first time I've had to pay half of next years up front...

Besides, I was asking if it is fair; do you think it is then Cailin? Do you think it is right that the government can charge you interest on an amount that is only an estimate? And if you think that is fair, is it fair that the interest that is charged is 2.5% above the BOE base rate?

Just interested, as your post seemed to imply I was stupid, yet all I was doing was questioning the taxation system.

[wendigo100]

By definition a taxation system cannot be fair.

Give unto Ceaser what is Ceasers.

Render unto Caesar the things which are Caesar's

You've met two of them threaded, you should know how to spell their name.

[cailin maith]

I've been doing self assessment for years...first time I've had to pay half of next years up front...

Besides, I was asking if it is fair; do you think it is then Cailin? Do you think it is right that the government can charge you interest on an amount that is only an estimate? And if you think that is fair, is it fair that the interest that is charged is 2.5% above the BOE base rate?

Just interested, as your post seemed to imply I was stupid, yet all I was doing was questioning the taxation system.

If you have been doing it for years, I am suprised that this is the first time you have had to make a payment on account.... not implying you are stpid, at all...

I have no opinion on whether it is fair or not to be honest. It's just the way it is.. first year is always the worst but next year you will only have to make a balancing payment and then the payment on account for the following year so wont be as big a hit.