Health and Wellbeing Tax Plan: Your guide to making a disclosure
Updated 7 October 2013
© Crown copyright 2013
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This publication is available at https://www.gov.uk/government/publications/health-and-wellbeing-tax-plan-your-guide-to-making-a-disclosure/health-and-wellbeing-tax-plan-your-guide-to-making-a-disclosure
The campaign has ended. People who missed the opportunity can still make a disclosure by using the Campaign Voluntary Disclosure Helpline on Telephone: 0300 123 1078, Monday to Friday, 8am to 6:30pm.
What is this guide about?
This guide tells you about the Health and Wellbeing Tax Plan voluntary disclosure opportunity which runs from 7 October 2013 to 6 April 2014. It will be of interest to you if you work in the field of health and wellbeing and you want to bring your tax affairs up to date. For example if you have not told HM Revenue & Customs (HMRC) about all your past income, gains and undisclosed liabilities.
You may be a professional working in the following areas:
- physical therapy - eg physiotherapist, chiropractor, chiropodist, osteopath, occupational therapist
- alternative medicine or therapy - eg homeopathy, acupuncture, nutritional therapy, reflexology, nutrition
- other therapy - eg psychology, speech therapy, arts therapy
This list is not exhaustive.
Help and advice
If you have any questions not covered by this guide please phone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507. Lines are open Monday to Friday 8:00am to 6:30pm.
Customers with particular needs
If you need extra help to deal with the Health & Wellbeing Tax Plan please get in touch. HMRC can help if:
- English is not your first language
- you want a copy of this guidance in Welsh
- you would like HMRC to use a certain format to communicate with you - for example braille or Text Relay
- you would like a copy of this guidance in audio or large print
Contact the helpline on Telephone: 0845 600 4507 or +44 1792 657 324 if dialling from outside the UK (Monday to Friday 8:00am to 6:30pm).
If you use Text Relay by text-phone, please dial 18001 + number. If you use Text Relay by telephone please dial 18002 + number.
If you prefer, you can visit your nearest HMRC Enquiry Centre to ask for help.
Find an enquiry centre on the HMRC website.
Your rights and obligations
HMRC’s customer charter (called Your-Charter) explains what you can expect from HMRC and what HMRC expects from you.
For more information visit the Your charter page.
What if you are unhappy with HMRC’s service?
If you are unhappy with HMRC’s service please phone the Health and Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507 or write to HMRC at the address below:
HMRC Local Compliance Centres
Health & Wellbeing Tax Plan Team S0790
PO Box 3900
Glasgow
G70 6AA
1. About the Health & Wellbeing Tax Plan
1.1 Introduction
HMRC believes that its customers want to pay the right amount of tax and wants to help those not paying the correct amount of tax to put that right. This guidance describes what to do if you need to put things right.
If you have nothing to disclose and pay to HMRC you do not need to use the Health & Wellbeing Tax Plan.
Using its legal powers HMRC obtains information about payments made to the health and wellbeing professions from various sources. HMRC also uses advanced technological tools which help identify people who have failed to pay the right amount of tax.
If you have undisclosed income and you have not paid the right amount of tax you now have the opportunity to notify, disclose and pay what you owe through the Health & Wellbeing Tax Plan.
1.2 The scope of the Health & Wellbeing Tax Plan
The Health & Wellbeing Tax Plan is an opportunity open to those working within the health and wellbeing professions with undisclosed taxes and duties.
If you wish to make a disclosure but you do not work within health and wellbeing please refer to ‘Disclosures outside of the Health & Wellbeing Tax Plan’ section of this guide.
1.3 How does the Health & Wellbeing Tax Plan work?
If you work within a health and wellbeing profession, you can benefit from the terms offered. Through notifying your intention to disclose by 31 December 2013 and making your disclosure and payment by 6 April 2014 you will have the following guarantees:
- you can tell HMRC how much penalty you believe you should pay, what you pay depends on why you have failed to disclose your income; if you have deliberately kept information from HMRC you should pay a higher penalty than if you have simply made a mistake
- if you cannot afford to pay what you owe in one lump sum, don’t worry; if your circumstances warrant it, you will be able to spread your payments
- if you have simply made a careless mistake you only pay for a maximum of 6 years - no matter how many years you’re behind with your tax affairs, however if you do not come forward and HMRC finds later that you are behind with your tax, it may be harder to convince HMRC that it was simply a mistake; the law allows HMRC to go back up to 20 years in serious cases or HMRC may carry out a criminal investigation
You may not have to pay any penalty at all but if you do it is likely to be lower than it would be if HMRC finds out you have not paid enough tax.
Under the Health & Wellbeing Tax Plan you can make:
- a personal disclosure
- a disclosure on behalf of a company, trust
- a disclosure as a personal representative of a deceased person
Agents can notify and disclose on behalf of their clients.
There are 2 stages to the Health & Wellbeing Tax Plan. You must notify HMRC by the 31 December 2013 of your intention to make a disclosure and then make your disclosure, and full payment by 6 April 2014.
By doing so, you will qualify for the terms of the Health & Wellbeing Tax Plan. If you do not notify HMRC by that date the Health & Wellbeing Tax Plan terms will not be available to you.
The disclosure forms and payment must reach HMRC by 6 April 2014.
If you have a disclosure to make but miss the notification deadline of 31 December 2013 you can still make a disclosure but this could affect the amount of penalty payable. Coming forward voluntarily will still help reduce any penalty you are charged so please send your disclosure to the address shown under the ‘Disclosures outside of the Health & Wellbeing Tax Plan’ section of this guide.
1.4 What’s in it for me?
It is always better to come to HMRC and obtain the best possible terms before HMRC comes to you.
This is an opportunity to stop worrying about what might happen; have certainty about what you owe and get things right for the future.
1.5 If I disclose this liability could HMRC publish details about me?
You will earn the maximum reduction of any relevant penalties for the quality of disclosure, and HMRC won’t publish your details if you do all of the following:
- notify HMRC that you are going to make a disclosure before the deadline for doing so
- make a full disclosure including full payment of tax owed which proves to be both accurate and complete before the deadline for doing so
- cooperate fully with HMRC if they ask you for any further information
HMRC may include you in a list of deliberate defaulters if you don’t follow these steps.
1.6 To take part in the Health & Wellbeing Tax Plan you should:
- tell HMRC that you want to take part in the Health & Wellbeing Tax Plan (Notify)
- tell HMRC about all income, gains, tax and duties you’ve not previously told them about (Disclose)
- make a formal offer
- pay what you owe
- help HMRC as much as you can if they ask you for more information. If you do not, HMRC may not accept your disclosure
These terms will not be available if you choose not to sign up for the Health & Wellbeing Tax Plan and HMRC later finds that you are behind with your tax affairs.
1.7 Disclosures that are unlikely to be accepted through the Health & Wellbeing Tax Plan
Certain disclosures are unlikely to be accepted under Health & Wellbeing Tax Plan:
- disclosures that are found to be materially incorrect or incomplete when checked by HMRC
- disclosures from customers where HMRC has notified their intention to open an enquiry or compliance check before the Health & Wellbeing Tax Plan opportunity opened on 7 October 2013, those who want to disclose liabilities should tell the person conducting the enquiry, a full and early disclosure will influence the amount of penalty HMRC seeks in the ongoing enquiry or investigation
- disclosures where HMRC believes the money that is the subject of the disclosure is the proceeds of serious organised crime for example VAT fraud, VAT bogus registration fraud, organised tax credit fraud and instances where there is wider criminality (such as an ongoing police investigation)
An important factor for HMRC in deciding if they will carry out civil or criminal investigations into cases of fiscal fraud is whether the taxpayer(s) has made a complete and unprompted disclosure of any amounts evaded or improperly reclaimed. Whilst HMRC would consider each case on its merits a complete and unprompted disclosure would generally suggest that a civil (rather than criminal) investigation was appropriate.
Also, if you were eligible for any previous HMRC disclosure opportunity and you did not disclose at that time, HMRC may find it hard to accept that anything you disclose through the Health & Wellbeing Tax Plan was not a result of something you did deliberately. HMRC would expect you to calculate your penalty and the number of years you should pay to reflect deliberate action. If you do not, HMRC may not accept your disclosure. You will be in this category if you have not yet come forward and would have been covered by a past campaign.
For more information see the HMRC Campaigns page.
1.8 Disclosures outside of the Health & Wellbeing Tax Plan
You can still make a disclosure and put your tax affairs in order even if you are not within the scope of the Health & Wellbeing Tax Plan. Your disclosure will not be part of this opportunity and the terms and penalties offered under the Health & Wellbeing Tax Plan will not be available.
If you make a full and voluntary disclosure of all unpaid liabilities in these circumstances you can expect a lower penalty than HMRC would otherwise seek if they raised an enquiry or compliance check without the disclosure.
You should telephone the Campaigns Voluntary Disclosure Helpline on Telephone: 0845 601 5041. This is a helpline specifically designed to help you if you do not fall within the scope of an ongoing campaign but wish to make a voluntary disclosure.
1.9 If you disclose very serious tax problems
HMRC cannot offer immunity from prosecution but an important factor when they are deciding whether to carry out criminal investigations into cases of tax fraud is whether you have made a complete and unprompted disclosure of any amounts evaded or improperly reclaimed.
1.10 If you leave something important out of your disclosure
If after submitting your disclosure you realise you have missed out something, you have until the end of the disclosure period 6 April 2014 to make an amendment. You can do this by contacting the helpline on Telephone: 0845 600 4507 or forwarding your amendment in writing to the following address:
HMRC Local Compliance Centres
Health & Wellbeing Tax Plan Team S0790
PO Box 3900
Glasgow
G70 6AA
If, after 6 April 2014 HMRC receives information indicating that your disclosure was incorrect, they have the right to look at your tax affairs again.
HMRC may write to you about the information they have received and if necessary, will send you assessments to collect any extra tax due. Interest and penalties will also be charged. Any penalties are likely to be higher than those offered by the Health & Wellbeing Tax Plan and HMRC may charge penalties on all the tax - including the tax previously dealt with under the Health & Wellbeing Tax Plan. In extreme cases HMRC may consider criminal prosecution and in such cases your disclosure could be used in evidence.
1.11 If you have undisclosed liabilities and choose not to disclose
Once the notification period ends HMRC will review the tax affairs of those customers who have not come forward. HMRC will identify those who they believe should have come forward by:
- comparing the information already in their possession with customers’ UK tax histories
- continuing to use their powers to obtain further detailed information about other payments made
HMRC may contact customers and carry out compliance checks or enquiries to resolve matters. Where additional taxes are due HMRC will usually charge higher penalties than those available under the Health & Wellbeing Tax Plan. The penalties could be up to 100% of the unpaid liabilities.
If a disclosure made within the terms of this disclosure opportunity is incomplete or there is a failure to disclose amounts liable to tax or duty, HMRC may consider the instigation of a criminal investigation, in line with their criminal investigation policy.
Find details of the HMRC Criminal Investigation Policy.
2. How to make a notification and disclosure to HMRC
2.1 What do I need to do?
There are 2 stages to the Health & Wellbeing Tax Plan. Each stage has its own time limit.
Stage 1 Notification:
You must tell HMRC of your intention to make a disclosure. You need to do this by 31 December 2013.
At this stage, you only need to tell HMRC that you will be making a disclosure
You do not need to provide any details of the undisclosed income or the tax you believe you owe.
You can tell HMRC about a disclosure:
- you will be making about your own tax affairs
- your client will be making (if you are a tax adviser)
- you will be making on behalf of your company (if you are a director)
- you will be making on behalf of someone else (if you are a trustee or the personal representative of a deceased person)
If you have more than one disclosure to make, you will need to complete a separate notification in respect of each disclosure.
You can notify:
- online by completing a notification form on the HMRC website
- by phone on Telephone: 0845 600 4507
HMRC will note your details if you telephone or they will send an electronic acknowledgment if you notify online. Later HMRC will write to you to confirm your unique Disclosure Reference Number to use whenever you contact them about the Health & Wellbeing Tax Plan.
You will also be given a Payment Reference Number to use when paying what you owe. If you would like HMRC to send you a payslip, please phone the helpline on Telephone: 0845 600 4507.
If you haven’t notified HMRC by 31 December 2013, you will not be able to make a disclosure under the Health & Wellbeing Tax Plan. This means that you will not receive the terms available.
Stage 2 Disclosure
You can do this as soon as you have your Disclosure Reference Number or at any time before 6 April 2014.
You can make a disclosure:
- about your own tax affairs
- on behalf of your company (if you are a director)
- on behalf of someone else (if you are a trustee or personal representative of a deceased person)
You can make your disclosure by:
- completing and submitting a disclosure form on the HMRC website
- printing and posting the completed form
You should post the completed disclosure form to:
HMRC Local Compliance Centres
Health & Wellbeing Tax Plan Team S0790
PO Box 3900
Glasgow
G70 6AA
Please quote your Disclosure Reference Number.
When you send your disclosure you must pay what you owe.
If you need help making your disclosure you can ask a tax adviser or you can phone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507. Lines are open Monday to Friday 8:00am to 6:30pm.
Please make sure that HMRC receives your disclosure and payment by 6 April 2014. If you cannot pay what you owe by 6 April 2014 you must have made payment arrangements with HMRC by that date.
If you do not do this you will not be able to make a disclosure under the Health & Wellbeing Tax Plan and will not receive the certainty of terms and conditions within it.
3. Preparing your disclosure
3.1 How to calculate what you owe
Depending on your circumstances this could be simple or complicated and you may want to seek independent professional advice. Although you have until 6 April 2014 to make your disclosure HMRC recommends that you start gathering together your information and records as early as possible. HMRC cannot provide individual advice on calculating how much you should pay.
Find Income Tax allowances, rates and bands.
Please click on the appropriate link for information on earlier years. All calculations must be in pounds sterling.
Exchange rates can be found on the HMRC website.
If you are taking part in the Health & Wellbeing Tax Plan you will know why you haven’t previously told HMRC about your income or paid the right amount of tax. HMRC asks you to decide whether you made an error despite taking reasonable care, whether you were careless, or whether it was something you did deliberately. How much you pay will depend on the answers to those questions.
3.2 Years covered by the Health & Wellbeing Tax Plan
The Health & Wellbeing Tax Plan is the opportunity to put your tax affairs in order up to 5 April 2012.
3.3 What years do you have to pay?
This depends on why things went wrong.
If you have taken care to make sure your tax affairs were correct but you have still paid too little, you will only have to pay HMRC what you owe for a maximum of 4 years. This means:
- you have to complete the disclosure form and pay HMRC what you owe for the 3 years up to 5 April 2012
- you have to make sure that your tax affairs for the year ended 5 April 2013 are correctly reflected on your 2012 to 2013 tax return
If you have been issued with tax returns for years ended 5 April 2011 or 5 April 2012 and have not completed them you should do so before 31 December 2013. You should not include these years in your disclosure.
If you have paid too little because you were careless, you will have to pay HMRC what you owe for a maximum of 6 years. This means:
- you have to complete the disclosure form and pay HMRC what you owe for the years up to 5 April 2012
- you have to make sure that your tax affairs for the year ended 5 April 2013 are correctly reflected on your 2012 to 2013 tax return
If you have been issued with tax returns for year ended 5 April 2011 or 5 April 2012 and have not completed them you should do so before 31 December 2013. You should not include these years in your disclosure.
If you have deliberately paid too little tax, for any year ended before 5 April 2008, you may need to go back to 1993 to 1994 and pay up to 20 years.
HMRC expects most people to have to pay a maximum of 6 years but there will be some who need to pay more. These are people who have been in business since before 6 April 2007 and have either:
- deliberately told HMRC they have earned less than they have
- not told HMRC anything at all about their income
3.4 If you do not have all the business records you need to make your disclosure
If this is you please phone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507 to advise HMRC.
If your records are incomplete you should make your best estimate of the undisclosed income and gains and use this to make your disclosure. HMRC may ask you to explain how you have worked out any estimates you have used, so you need to keep your calculations.
If you have your bank statements for the period of your disclosure they will probably help. If you don’t have them, HMRC recommends that you contact your bank as soon as possible to ask for copies. Although banks charge for providing copies of statements, most banks have a limit on how much they charge. This means it may not cost you too much to get copies.
If you cannot get copy statements at all, you should work out your income by using more recent statements as a guide to your income and expenditure. HMRC may ask you to explain why you couldn’t get copy statements.
If you have not kept proper business records you should begin to do so immediately. This opportunity is your chance to put things right from now on. If HMRC finds in the future that you have failed to keep appropriate records, they can penalise you up to £3,000.
You must keep Business records if you’re self employed
You can also ask your tax adviser if you need help, or phone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507.
3.5 If you use estimated figures in your disclosure and it is found to be materially incorrect or incomplete
If HMRC decides that your disclosure was incorrect or incomplete, they will notify you it has been rejected and inform you how they intend to proceed. You will have to pay the extra tax and interest. HMRC may also charge you a higher penalty than the one you included in your disclosure.
If HMRC decides that you have acted dishonestly in making your disclosure, they will consider carrying out a criminal investigation.
3.6 Tax and Class 4 National Insurance contributions relating to your income
You need to include separately in your disclosure the tax and Class 4 National Insurance contributions due on your income. There are calculators on the HMRC website that may help you to work out these figures. These calculators should only be used for helping you to complete your disclosure under the Health & Wellbeing Tax Plan. They must not be used for any other purpose.
The amount of National Insurance contributions that you pay to HMRC is routinely notified to the Department for Work and Pensions. However if you are concerned that the earnings you are now declaring could impact on any means tested benefits such as housing benefit or council tax benefit you receive, you should contact your local authority to discuss this.
3.7 Other liabilities
You need to include any other untaxed income in your disclosure as well as the income you receive from your health and wellbeing activities. This may include:
- earned income not taxed before you receive it, for example, profits from another business
- investment income not taxed before you receive it, for example, interest
- income from property or land rental etc (less the expenses relating to that income)
- capital gains made on the disposal of investments, such as land, property, shares, stocks, bonds, goodwill
If you’re not sure whether you should have paid tax or National Insurance contributions there are several ways you can get more information or help. You can:
- read about taxable and non-taxable income by following the link below
- phone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507
- visit a HMRC Enquiry Centre (you may need to make an appointment first by phoning the Taxes Helpline on Telephone: 0845 300 0627)
Find your nearest enquiry centre on the HMRC website
The tax calculators may help you.
3.8 Employer Tax and National Insurance contributions on wages for employees
If you employed anyone, and you have not deducted and/or paid the tax and National Insurance contributions in respect of their earnings this needs to be included on your disclosure form.
Find the disclosure form on the HMRC website.
3.9 VAT
You will need to consider whether you should have registered for VAT and charged VAT on goods or services that you have provided.
Read more about how and when to register for VAT.
The current threshold for VAT registration, if you make taxable supplies, is £79,000. If your turnover of taxable goods and services supplied within the UK for the previous 12 months is more than the current registration threshold or you expect it to go over that figure in the next 30 days alone, you must register for VAT.
If your turnover for any of the earlier years took you over the VAT registration threshold for that year, it’s possible that you should have been VAT registered before now. The requirement to register is based on a 12 month rolling period and needs to be reviewed monthly to see if you should have been registered or need to register now.
Find out more about if you should be registered for VAT on the HMRC website
Do not include the VAT you owe in your disclosure through the Health & Wellbeing Tax Plan. If you think you should have been registered or you are registered and owe VAT, you should complete your disclosure to cover the other taxes and duties you owe and tick the appropriate VAT box on the disclosure form.
HMRC will contact you to explain what to do to put your VAT affairs right. HMRC charges penalties for inaccuracies and certain VAT and Excise offences (known as ‘wrongdoings’).
3.10 Class 2 National Insurance contributions
If you are self-employed but have not yet registered to pay Class 2 National Insurance contributions you need to do so immediately so you do not lose out on future benefits.
Read more about registering for Class 2 National Insurance contributions on the HMRC website.
Do not include Class 2 National Insurance contributions in your disclosure through the Health and Wellbeing Tax Plan.
3.11 Interest
HMRC charges interest from the date tax/National Insurance contributions are due until the date they are actually paid. Interest is calculated on a daily basis.
3.12 Penalties
HMRC charges penalties on any additional tax or National Insurance contributions due as a result of you having:
- sent HMRC an incorrect tax return
- not told HMRC that you have started to be liable to tax
HMRC does not charge interest on these penalties unless they are paid late.
The penalty is a percentage of the additional amount due. Normally, penalties can be up to 100% of the tax liability but for the Health & Wellbeing Tax Plan the rates are 0%, 10%, 15%, 20% and 35% depending on the circumstances.
There is a penalty chart at Appendix A of this guide that will help you find which penalty percentage relates to your circumstances. Once you have found the percentage that relates to you, you should work out the amount of penalty you owe by multiplying the amount of total tax and National Insurance contributions due by the penalty percentage.
For example, if the total tax and National Insurance contributions due is £3,000 and your circumstances mean that you have to pay a 10% penalty, your penalty will be £300. The calculators can be used to work out your penalty.
When HMRC checks your disclosure they will consider whether the penalty you have applied is reasonable.
There is a space on the disclosure form where you can provide an explanation.
HMRC expects to be able to accept most disclosures but if they think the penalty applied is inadequate they may need to carry out a further check of your tax affairs. For example, HMRC may find it difficult to accept, without further enquiry, that someone in business for many years, earning significant amounts without telling HMRC, has not done this deliberately.
3.13 Total of all amounts due for the year
You need to add the interest and penalties to the total unpaid liabilities for the year to calculate this figure.
3.14 Total of what you need to pay for all years
To find out the total of what you need to pay, you will need to add together the total amounts due for each year included in your disclosure.
3.15 Declaration
This is a very important part of your disclosure. You should only complete the declaration once you are certain that your disclosure is correct and complete and that you understand why you have been asked to include penalties in your disclosure.
3.16 Offer
It is a condition of using the Health & Wellbeing Tax Plan that you make an offer for the full amount of everything you owe. Your offer, together with HMRC’s acceptance letter to you will create a legally binding contract between you and HMRC. There are letters of offer included in the disclosure forms which you should complete.
4. Paying HMRC
4.1 When will you have to pay?
Unless you have contacted HMRC to agree additional time to pay, you should send your payment at the same time as you send your disclosure, but no later than 6 April 2014.
4.2 Payment Methods
HMRC accepts payment by a range of methods but recommends that you make your payment electronically. Electronic payments are more efficient, secure and safer than payment by post. Whichever way you pay, please make sure that you quote your Payment Reference Number.
The different payment methods available are:
- Direct Debit
- Debit or Credit Card
- through your own bank or building society by Internet or telephone banking or CHAPS
- at your bank
- at the Post Office
- by post
Find information about paying HMRC on the HMRC website.
4.3 What if you cannot pay the full amount?
HMRC expects you to pay what you owe when you make your disclosure.
If for some reason you cannot pay the full amount, you will need to let HMRC know as soon as possible and before you send in your disclosure. To do this, you should contact the helpline on Telephone: 0845 600 4507. Lines are open Monday to Friday 8:00am to 6:30pm.
When you phone, HMRC will want to talk to you about your current financial position so they can tell you what they think you should pay and when. To help HMRC decide, you will need to tell them:
- your Disclosure Reference Number
- how and when you intend to pay HMRC what you owe
- what your current weekly/monthly income and outgoings are
- what you own, including your home, other property/land, vehicles, investments, money in the bank etc
- what you owe, including mortgages, loans, credit cards
If you cannot pay the full amount do not submit your disclosure or payment until you have spoken to HMRC.
5. After HMRC receives your disclosure
5.1 Accepting your disclosure
HMRC anticipates that the vast majority of disclosures will be accepted. If after checks HMRC is satisfied that you have made a full disclosure, they will accept it as quickly as possible.
5.2 Acknowledging your disclosure
When they receive your disclosure, HMRC will send you an acknowledgment as soon as possible. HMRC will then consider the disclosure under the terms of the Health & Wellbeing Tax Plan. If you haven’t received an acknowledgement within 2 weeks of sending your disclosure, please telephone the Health & Wellbeing Tax Plan Helpline on Telephone: 0845 600 4507.
HMRC expects most disclosures to be self explanatory but they may need to contact you or your tax adviser to clarify any points. You may also be asked to provide evidence of your circumstances to satisfy HMRC that your disclosure is complete. Your full co-operation is one of the conditions of using this opportunity and failure to co-operate may jeopardise acceptance of your offer.
5.3 Considering your disclosure
HMRC will review all disclosures and expect the vast majority of disclosures to be accepted and where this is the case they will send you a letter accepting your offer. If HMRC cannot accept the disclosure they will contact you. If following their enquiries HMRC finds that a disclosure is materially incorrect they will seek significantly higher penalties. It is also possible that in exceptional circumstances an incomplete disclosure may be considered under HMRC Criminal Investigation Policy. In such cases the material in the disclosure could be used as evidence.
5.4 Information received after disclosure accepted
HMRC will continue to seek new information. They will use it to identify customers where a disclosure should have been made or where the disclosure made is not what was expected based on the information HMRC holds.
6. Getting things right for the future
Please be sure to declare all income, profits or gains on the relevant tax returns from year ended 5 April 2013 onwards or advise your own Tax Office (see contact details on latest PAYE coding notice).
7. Tax Credits
If you or your partner are receiving or have recently made a claim for tax credits, you should still make a disclosure but also tick the appropriate box on your disclosure form. The information will be passed to the Tax Credit Office to consider. You will be notified separately of any changes that may be required to the amount of tax credits you receive or have received for the relevant year(s). If you have made a joint claim for tax credits you may need to tell your partner that the award may be adjusted as a result of your disclosure.
7.1 Inheritance Tax
If you need to disclose unpaid Inheritance Tax you should still make a disclosure but also tick the appropriate box on the disclosure form.
7.2 Other issues
HMRC recognises that some people have more complex tax affairs and may be affected by other issues.
If you are still in doubt please ask your tax adviser or Telephone: 0845 600 4507.
8. General information
8.1 HM Revenue & Customs’ commitment
Find more information about HMRC’s service commitment.
8.2 Privacy and confidentiality policy
The full protection of the Human Rights Act will continue to apply to you and HMRC has a strict policy regarding the privacy and confidentiality of customers’ personal information.
Read HMRC’s privacy policy in the Personal Information Charter.
8.3 Data Protection Act
HMRC is a Data Controller under the Data Protection Act 1998. HMRC holds information for the purposes specified in their notification to the Information Commissioner, including the assessment and collection of tax and duties, the payment of benefits and the prevention and detection of crime, and may use this information for any of them.
HMRC may get information about you from others, or they may give information to them. If HMRC does, it will only be as the law permits to:
- check the accuracy of information
- prevent or detect crime
- protect public funds
HMRC may check information they receive about you with what is already in their records. This can include information provided by you, as well as by others such as other government departments or agencies and overseas tax and customs authorities. HMRC will not give information to anyone outside HM Revenue & Customs unless the law permits them to do so.
For more information see HMRC’s Data Protection - Information Charter on the HMRC website.
Appendix A: About the penalties that HMRC may charge in the Health & Wellbeing Tax Plan
The tables below show the rate of penalty that HMRC might charge in a range of circumstances. You should find an example that you think best applies to your circumstances to see how much HMRC might charge you.
The tables show:
- the penalty HMRC will charge if you do take part in the Health & Wellbeing Tax Plan
- the penalty HMRC will charge if you don’t take part and they later find that you have not told them about all your income and paid enough tax
Although the rate of the penalties will vary depending upon your circumstances, they will usually be lower if you take part in the Health & Wellbeing Tax Plan than they would be if you do not.
If you have not declared the correct tax payable to HMRC despite taking reasonable care with your tax affairs, you will not pay any penalties at all. HMRC does not expect many people’s circumstances to fall within this category.
If you have not paid enough tax despite taking reasonable care with your affairs or there is anything else you think HMRC need to consider concerning the penalties you have to pay, please phone the helpline before making your disclosure.
If HMRC thinks that you have not included the right penalty in your disclosure, they may reject your disclosure.
The Health & Wellbeing Tax Plan Helpline number is Telephone: 0845 600 4507.
Penalty if you come forward in this Health and Wellbeing Tax Plan
Please note higher penalties of up to 200% can be charged in relation to offshore income or gains.
Penalties applicable to offshore income and gains are proportionately higher dependant on the Offshore Category and this includes your disclosure.
Penalties for category 2 are 1.5 times the corresponding penalty for category 1 and penalties for category 3 are 2 times the corresponding penalty for category 1.
Penalties for making an inaccurate return
| Circumstances | Tax years up to 5 April 2008 | Tax years from 6 April 2008 |
|---|---|---|
| You send HMRC a return showing less tax payable than the correct because you had been careless | 10% of the tax due | No penalty |
| You sent HMRC a return knowing it showed less tax payable than the correct amount. (You may have to pay penalties of up to 100% of the tax due if you tried to conceal the inaccuracy or failure | 20% of the tax due | 20% of the tax due |
Penalties for failing to tell us about your liability to tax
| Circumstances | Tax years up to 5 April 2009 | Tax years from 6 April 2009 |
|---|---|---|
| You started self employment, made a gain or received other untaxed income and did not tell HMRC that you needed to make a return, but you weren’t deliberately trying to keep the information from HMRC | 10% of the tax due | 10% of the tax due or 0% if you advise HMRC within 12 months from when the tax first became unpaid |
| You deliberately failed to tell HMRC you had started self employment, made a gain or received other untaxed income and needed to make a return. (You may have to pay penalties of up to 100% of the tax due if you tried to conceal the inaccuracy or failure.) | 20% of the tax due | 20% of the tax due |
Penalty if HMRC finds out that you have not paid enough tax
Please note higher penalties of up to 200% can be charged in relation to offshore income or gains.
Penalties applicable to offshore income and gains are proportionately higher dependant on the Offshore Category and this includes your disclosure.
Penalties for category 2 are 1.5 times the corresponding penalty for category 1 and penalties for category 3 are 2 times the corresponding penalty for category 1.
Penalties for making an inaccurate return
| Circumstances | Tax years ending up to 5 April 2008 | Tax years from 6 April 2008 |
|---|---|---|
| You send HMRC a return showing less tax payable than the correct because you had been careless | Up to 100% of the tax due | Between 15% - 30% of the tax due |
| You deliberately sent HMRC a return showing less tax due in order to understate your tax bill(You may have to pay penalties of up to 100% of the tax due if you tried to conceal the inaccuracy or failure.) | Up to 100% of the tax due | Between 35% - 70% of the tax due |
Penalties for failing to tell us about your liability to tax
| Circumstances | Tax years ending up to 5 April 2009 | Tax years from 6 April 2009 |
|---|---|---|
| You started self employment, made a gain or received other untaxed income but haven’t told HMRC about it or sent HMRC a tax return, but you weren’t deliberately trying to keep the information from them | Up to 100% of the tax due | Between 20% - 30% of the tax due or 10% if you advise HMRC within 12 months of when the tax first becomes unpaid by reason of the failure |
| You deliberately failed to tell HMRC you had started self employment, made a gain or received other untaxed income and needed to make a return. (You may have to pay penalties of up to 100% of the tax due if you tried to conceal the inaccuracy or failure.) | Up to 100% of the tax due | Between 35% - 70% of the tax due |
You may have to pay penalties of up to 100% (200% for offshore related income) of the tax due if you tried to conceal the extent of the undeclared tax. If this applies to you please call HMRC on Telephone: 0845 600 4507
Appendix B: Interest due on payments made in the Disclosure
To help you work out the interest you should include in your disclosure, you can use the calculators on the HMRC website.
Interest and penalty calculator for the tax years 1992 to 1993 up to 2011 to 2012 (PDF, 36KB.
If you are unable to access the calculators, you can find details of interest rates on late payments for the various taxes and duties on the HMRC website
Late payment and repayment interest rates on the HMRC website
The sooner the Income Tax, Class 4 National Insurance contributions or Capital Gains tax that you are disclosing is paid the lower the interest payable on the tax or contribution will be.