Flakey Tax Advisor / Partnership Tax Return late filing fees

[JohnSwansea]

My cleaners are a Romanian couple. They asked me to help re late filing penalties they have been charged for their business tax return for the year ended April 13.

 

They use a tax advisor who seems to talk a good game - he is also Romanian and goes on about how he wants to help downtrodden Romanians. But I sense he is not that reliable, as it seems my cleaners have been fobbed off by him when they have queried why they are getting chased for not filing their returns when they paid him to make the filings.

 

When I bugged this advisor about this he did send me a summary sheet showing that the cleaners' personal tax returns for year ended April 13 were filed on time. They pay no tax as the return shows a net income of £5,000 each. But what HMRC are chasing about is the tax return for the Romanian couple's business partnership - this is clear from the letters which have the trading partnership name on them. It seems clear that the partnership tax return was not filed. Not sure how it was missed - clearly the trading results of the partnership were compiled, how else could the personal tax returns have been completed.

 

Anyone any suggestions as to best course of action?

 

What are HMRC likely to do about two £1,200 late fees due by two Romanian cleaners with very low incomes and no assets? Will the write them off, or will they chase them via debt collectors / legal action / bankruptcy proceedings? Can HMRC add these to future tax bills (although in practice I expect this couple and thier partnership will never have any income taxes as they earn so little)? Or can they deduct them from housing benefit or tax credits of the two partners?

 

Will HMRC accept a lower amount in settlement of these fees, eg if they were offered £1,000 total rather than £2,400 do you think they would accept?

 

And if we give HMRC a sob story about how this couple were let down by their tax advisor, that they thought all was fine as they filed their personal tax returns on time, that they dont understand English, that they have no money etc (all of which is true), might HMRC drop the late filing charges entirely?

 

What is the best way to engage with HMRC on this - on the phone? or by letter? or should they find a new tax advisor who can approach HMRC on their behalf to try to sort this out?

 

Any thoughts generally welcome

[ericsbrother]

they can explain the situation to the authorites and ask for the penalties to be cancelled. They have a responsibility to ensure they file, even if they employ someone else to do the job so HMRC wont be happy if it happens again but there is a good chance they will cancel this time.

HMRC cannot recover the money if their income is that low so the debt will remain on file for ever as long as they know the circumstances.