LPT: The cost of non compliance...

M

mandelbrot

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This just came to my attention in the last week or so...
[broken link removed]

A couple of the most relevant parts are quoted below:

"The ‘test’ as to whether a LPT-generated surcharge applies is done when the income tax return is filed, as long as this occurs on or before the deadline for doing so, i.e. either the statutory return filing date or the online extension date.​


This consists of asking (in relation to all of a liable person’s properties):
  • if any LPT return that was due to be filed before that date has been filed and
  • where all of the LPT returns have been filed, is there any payable LPT liability that is unpaid and that is not being paid in accordance with an agreed payment arrangement.​
If the answer to either of these questions is “yes”, the surcharge applies."​


"Unlike the position with the usual income tax surcharge, the LPT-generated surcharge may not be a one-off occurrence. A LPT return that remains unfiled for a particular year, or a particular LPT liability that remains unpaid, may generate an ongoing income tax surcharge until such time as the position is rectified."​

So, what does all of this mean? If you have decided to be one of the few to make a stand against LPT on a point of principle, and not filed a return and/or not paid the LPT amount falling due, and if you are a self assessment tax filer, you will be hit with a 10% surcharge on your income tax & CGT liabilities, for as long as your LPT returns & payment remain outstanding.​

Upon filing & paying the outstanding LPT returns/payments, the surcharge will be revised downwards to be capped at the amount of the LPT liability (if it is lower than the surcharge).​

So the best case scenario is that you will end up paying the LPT twice - once via income tax / CGT surcharges, as well as paying the actual LPT itself at some point.​

Resistance is futile it would seem.​
 
It's telling though that the penalties for self employed LPT defaulters are.much worse than those for others.

Discrimination once again.
 
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