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HMRC internal manual

Self Assessment Manual

From
HM Revenue & Customs
Updated
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Returns: trust returns: unsatisfactory trust returns

General

The return must 

  • Be electronically filed, or be on the HMRC paper form, or be a computer generated version which is identical to the official HMRC form.
  • Be signed by the correct person, including a person acting in any capacity
  • Include accounts and statements of assets and liabilities in the case of approved self-administered Pension Schemes
  • Include all supplementary pages indicated on the return as being necessary. Note: A spreadsheet, table or list providing details which should be on separate supplementary pages (multiple trades or partnerships) is not acceptable
  • Include details in all boxes which should have been completed on the return, unless the information can be obtained from elsewhere. Note: These cases can only be identified during capture of the return
  • Not include entries

    • ‘Per attached’, and the information cannot be easily identified from the details supplied. Note: A spreadsheet, table or list providing details which should be on separate supplementary pages (multiple trades, partnerships, accounting periods) is not acceptable
    • ‘To follow’, which indicates that required information has not been filed
    • ‘Per enclosed accounts’, and the SAI has not been completed correctly

    Note: Further information is available in subject ‘SAI: Completion of Trust Return’ (SAM123180) for returns which should contain SAI but either no SAI is included or only minimal details are returned.

An unsatisfactory return is a return that fails to satisfy the filing requirement of Sections 8 and 8A TMA1970 as stated in the ‘Notice to File’.

Section 8 TMA1970requires that returns provide information reasonably required for the purpose of establishing the amounts in which a person is chargeable.

Exception

The exception to these general rules is

  • The omission of information in support of a Tax Credit Relief claim on the Foreign Income pages. This will not make a return unsatisfactory if

    • Liverpool Large Business Office has agreed the omission with the partnership

    Or

    • The entry is supported by a claim to partial exemption from UK tax on income by a dual resident

All cases

All cases where it is considered an unsatisfactory return has been received should be reviewed for the next appropriate action by an experienced Officer.

If, following the review, it is considered that the return could in fact be treated as satisfactory, the experienced Officer should

  • Log the return
  • Identify all omissions and errors
  • Obtain all information possible from the return and enclosures and, where the information can be easily identified, make repairs to the return entries

If, following the review, the return is still considered as unsatisfactory, no repairs of obvious errors should be made and the form should be sent back without any amendment (with any relevant missing supplementary page for completion where applicable). If it does not satisfy the requirements then it is not a return and we can only correct a return.

An unsatisfactory return must be rejected and sent back to the trustee or agent who submitted it (only to an agent where 64-8 held). Where an agent is acting, a letter should also be issued to the other party notifying them of the action taken.

Note: If, in a case where an agent is acting, it is not possible to tell who submitted the return, it should be sent back to the trustee as it is their ultimate responsibility to ensure that a satisfactory return is submitted.

Unsatisfactory returns received before the filing date and which are being sent back within 21 days before 31 October (or within 21 days of any other filing date), must be unlogged, if the return had been logged beforehand, before the return is sent back for completion by the trustee or agent who submitted it.

Prior to 6 April 2012, when unlogging a return, you need to check if any penalties have been charged and if so, the penalty will need to be cancelled before unlogging the return. Note: That if a penalty has been cancelled and the return is received late, or not received by the online filing deadline, that the system will not charge a new penalty and a miscellaneous penalty charge will need to be created using function CREATE SUNDRY CHARGE.

From 6 April 2012, if penalties have already been charged, the unlogging of the return will cause the penalty position to be reviewed automatically by the system and, if applicable, penalties may be cancelled. For more information see subject ‘Effects of unlogging a return’, (SAM61360).

These returns should be handled in accordance with the Action Guide (SAM123211).

Notes: 

1. Unsatisfactory returns received on 1 November should not be treated in the same way as those received in the period 10 to 31 October. This is to correspond with the fact that a return received on that date is considered to be late and will attract a penalty
   
2. Where the return has been received prior to the filing date but is being returned as unsatisfactory within21 days before the filing date, a period of 21 days is given to allow a satisfactory return to be submitted. A period longer than 21 days should be allowed in certain exceptional circumstances, for example overseas addresses or UK geographical areas where there are known longer postal times

All returns that are rejected must be accompanied by a letter explaining why it is being sent back. The correct letter should be issued in accordance with the table below.

Date Return Received Date Return sent back Issue Letter
     
Before 10 October    

Or

Up to 21 days before any other filing date Before 10 October

Or

Up to 21 days before any other filing date SA603
  Before 10 October

Or

Up to 21 days before any other filing date 10 October or later

Or

On or after the day which is 20 days before any other filing date SA604
  10 October to 1 November

Or

From 20 days before, up to and including any other filing date 10 October or later

Or

On or after the day which is 20 days before any other filing date SA604    
  After the filing date Any day SA605

For the avoidance of doubt the 21 day period of grace, or longer where allowed, only applies where the return is unsatisfactory as a result of a genuine oversight. It does not apply where the return is deliberately unsatisfactory, in an attempt to take advantage of the period of grace. For example, the 21 days, or longer where allowed, do not apply if a return is deliberately sent in without a relevant set of pages, to buy a little more time to complete those pages. Nor does it apply if a return is deliberately sent in without a signature, to buy a little more time to obtain the signature. If you come across a case where an unsatisfactory return is sent in several years running, refer it to an experienced officer to decide whether the 21 day period of grace, or longer where allowed, can be given or not.