Date posted: 14th Apr 2025
HMRC have announced that anyone with only PAYE income, will not be required to complete a 2024/25 tax return.
Before you think that is good news that you don’t need to complete a tax return, this relies on HMRC actually calculating the correct tax liability, issuing correct PAYE codes based on income levels (see our article on the 60% tax trap) and capturing benefits in kind correctly.
HMRC will also rely on you to ensure that any changes in income is reported to them in good time. For instances, changes in charitable donations, pension contributions, child benefit, P11D benefits, increases in dividend/savings income above allowances etc.
This could lead to potential overpayments of tax, by taxpayers, unaware that their tax position isn’t up to date. More worryingly, those that potentially underpay tax could be liable to several years of tax bills, if this is not picked up by HMRC for a number of years, as we see on a regular basis. Underpaid tax will lead to interest being due and potential late payment charges/penalties.Many taxpayers like to complete a tax return (and there is nothing to stop you voluntarily submitting a tax return) or at least having their accountant undertake a tax review to check that there is no overpayment or underpayment of tax.
Forgive us for being sceptical, but we suspect that simply relying on HMRC may be a mistake.
Contact our expert team here.
