HMRC to re-open Tax Calculations

In April 2016 changes to the tax rules resulted in errors in HMRC’s self-assessment calculations. It now says that it intends to revisit some of these. Will you be affected and will you have more tax to pay?

Which tax calculations? Self-assessment tax returns for individuals for 2016/17 which were submitted online face re-assessment by HMRC. If you submitted your return in paper format you’re in the clear as any errors caused by HMRC’s faulty tax calculation program were made at the time the form was processed.

Is an adjustment required? When HMRC realised there were problems with its tax calculator it published a list of circumstances in which it recommended you submit a paper return rather than an online one. The final version wasn’t published until 9th November 2017. Many individuals and accountants weren’t aware of the so-called “exclusions for online filing” list or didn’t know that it applied in the particular circumstances.

Trap: Don’t assume that because your accountant prepared your tax return they will have corrected HMRC’s calculation. Tax return software must follow HMRC guidelines, even if it results in an error. The 28-page list of errors for 2016/17 (only 16 pages for 2017/18) made it easy to overlook something.

Tip: While the deadline for filing your 2017/18 tax return on paper was 31st October 2018, if there’s an exclusion on the list which applies to you, HMRC says that you can submit a paper form up to 31st January 2019 without a penalty applying.

What next? HMRC has identified around 30,000 2016/17 tax calculations which may be wrong. It will start making recalculations on 19th November. If a correction is required it will notify you, but not your accountant, of the result. Refunds will be repaid immediately or, if you owe more tax, you’ll receive a demand which must be settled within 28 days.


Up to 30,000 calculations for returns submitted online are wrong. Check HMRC’s list to see if you might be affected. A recalculation may result in a refund, but if further tax is due you’ll have 28 days to pay.

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