Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Enquiry Manual

From
HM Revenue & Customs
Updated
, see all updates

Concluding an Enquiry: SA Legislation: Examples of the Amount of Tax on SA Closure Notices

Example 1

Victoria is self employed. Her self assessment shows tax due for the year (Box 18.3 in her return) of £3,000. An enquiry shows that the correct figure should have been £5,500 (made up of income tax, £5,000, and Class 4 NIC, £500).

The amendment in the closure notice will show the original self assessment of £3,000, the additional tax of £2,500 and the total amended self assessment of £5,500; i.e. the total amount of tax which should be included in the self assessment for the year.

Example 2

If in example 1 a jeopardy amendment to Victoria’s self assessment was made bringing her self assessment to £5,000, the additional tax brought into charge is £2,000.

The amendment in the closure notice will show the amended self assessment of £5,000, the additional tax of £500 and the total amended self assessment remains £5,500. The earlier jeopardy amendment makes no difference to the amount of tax which should be included in the self assessment for the year.

Example 3

Emma is an employee. All her earnings are subject to PAYE deduction. Her return shows an overpayment of £2,000, ie the figure in box 18.3 was (£2,000). The return shows a substantial claim for ITEPA2003/S336 expenses in box 1.32. The case is taken up for enquiry and it is established that no repayment arises.

The amendment in the closure notice will show the original self assessment of a £2,000 repayment, the additional tax of £2,000 and the total amended self assessment of £nil; ie the total amount of tax which should be included in the self assessment for the year.

Whether or not a repayment has been made prior to the opening of the enquiry will not affect the amendment figure to be included in the closure notice. You can enter the overall payment or repayment position, on the date you close the enquiry, into your closure notice.

Example 4

Geri’s self assessment shows a repayment due of £1,500; ie the figure in box 18.3 is (£1,500). An enquiry shows that the self assessment should show only £1,000 overpaid.

The amendment in the closure notice will show the original self assessment of a £1,500 repayment, the additional tax of £500 and the total amended self assessment of £1,000 repayment. Any over-repayment already made will be resolved in the taxpayer statement.