Tuesday, March 1, 2011

Tax amnesty for Plumbers is a good thing but it's not an amnesty

You'll see lots of reference to this so-called tax amnesty' for plumbers over the next few days.

HMRC says:
The Plumbers Tax Safe Plan (PTSP) is designed for people working within the plumbing industry who have not told HM Revenue & Customs (HMRC) about all their income in the past and who now want to get back on track. It is intended to cover people who work (or worked) in the plumbing, heating or gas installation trades and this includes anyone who installs and repairs pipes and fixtures for water, drainage or gas systems in a building.
This is part of HMRC's plan to catch up with everyone who has been doing cash in hand work and who wants to get straight with the taxman. There is NO TAX AMNESTY though.

Everyone who 'fesses up' will be required to pay all of the taxes they had hoped to avoid, plus interest on the late paid tax and a penalty. The 'Plan' simply means that the penalty will be limited - in most cases to 20% of the late paid tax.

As HMRC says:
It's basically a 'fresh start'. If you decide to take advantage of PTSP, you can stop worrying about what might have happened had HMRC found out that you'd not been telling them about all of your income. It's a chance to start getting things right from now on, whilst knowing exactly how much it's going to cost to sort out things for the past.
The guidance around the Plan is quite complex and many people will benefit from professional help especially if their confession covers many tax years.

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