HMRC has started sending letters to taxpayers which gives them an opportunity to amend their tax affairs, where applicable, by making a digital disclosure ...
The letters state that HMRC has facts on hand to suggest that the recipient has not declared all income on their relevant tax return!
If the recipient confirms that they intend to go ahead with the digital disclosure, HMRC will send them a response. They then have up to 90 days from the date of the letter to sort out and pay any extra tax due through the digital disclosure system.
HMRC will accept confirmation in the following formats:
- A Certificate of Tax Position Reply, containing the relevant box ticked and the certificate signed by the taxpayer.
- A letter from the taxpayer or an authorised representative declaring whether or not there is any need to disclose, as well as the reasons why.
- Confirmation through the phone from the taxpayer or an authorised representative to state whether or not there is a need to disclose, and the reasons why.
- A copy of the letter concerning online marketplace sales can be found here. The other letter is the same except that it pertains to digital content creators.
As with all things concerning HMRC, it's best not to react to a nudge letter from them immediately and seek the advice of an accountant like me before responding. They may say they have a lot of information about your income-generating activities, but equally, they could just be fishing like they've done with other nudge letter campaigns.
Always seek professional advice before responding.
If you feel inspired to find out more about anything I've said here, do call me on 01908 774320 or leave a comment below and I'll be in touch as soon as I can.