June 21, 2017
HMRC has admitted that there is a problem with its tax calculation software as it contains a programming bug which affects self-assessment return forms submitted using either its own or third-party software.
The problem relates to the dividend and saving rates and HMRC’s systems won’t cope where the dividend nil rate band or the savings starting rate applies.
HMRC say they are correcting the problem and has given the following explanation of precisely when a return will be affected.
“non-savings income less than the personal allowance and SSR (£16000) plus savings income not covered by any personal saving allowance (YOU) are entitled to, the SSR is not been given.
Non-savings / savings / dividend income and (YOUR) income exceeds the basic rate band (BRB) the calculation is incorrectly reducing the higher rate band by the £5000 dividend allowance rather than by the amount of the allowance not used in the BRB”
HMRC says that until the bugs are fixed if you fall into one of the situations described above you should complete a paper tax return to avoid the wrong amount of tax being calculated.
If you feel you may be affected by the above please get in touch with The Profit Key on 01530 416555 or firstname.lastname@example.org