Aimed at dentists with miscellaneous sources of income.
The Tax Health Plan (THP) was one of the first targeted tax disclosure opportunities. It was aimed at doctors and dentists with miscellaneous sources of income such as from writing medical insurance reports, working as a locum, or for signing certain certificates. Taxpayers who opted to use the THP were required to make a full disclosure and pay all tax, penalties and interest due by 30 June 2010.
HMRC have used their powers to obtain lists of payments made to medical practitioners from pharmaceutical companies, insurance companies and locum agencies. As a DBS client, we expect you have told us about these sources of income which we will have included within your accounts as ‘other income’. This may not be evident to HMRC but once we point this out to them the enquiry should be closed swiftly.
HMRC are now confident they have processed all the disclosures from the THP and are now writing to over 2,500 doctors and dentists who did not take advantage of the THP, but who HMRC believe received some untaxed income. If you receive one of these letters, please let us know straight away. We will have 21 days to reply to HMRC (if you do not respond to HMRC within this time scale, HMRC can either amend your self-assessment tax return if the enquiry window is still open, or issue what is known as a discovery assessment for the amount of tax HMRC think is owed to the Treasury).
The Tax Catch Up Plan
Another HMRC disclosure campaign which could affect you is the Tax Catch Up Plan for tutors and coaches (TCUP), designed to flush out undeclared income from self-employed tutoring or coaching. Again, HMRC have used their powers to obtain lists of payments made to tutors by education and training providers and we expect DBS clients will have told us about these sources of income for disclosure, either within your accounts or separately within your tax return form.
You still have time to disclose untaxed income from lecturing or tutoring if you have not already done so, by making a declaration of the intention to disclose before 6 January 2012, followed by full disclosure and payment of all tax due by 31 March 2012. The advantage to doing so will be a reduction in the penalties for non-disclosure.
To head off a potential enquiry, we recommend that clients who receive untaxed lecturing or tutoring income which we are already recording within the accounts and tax return should note on the tax return form pointing this out to HMRC.
Please contact Penny Bowen with any questions you may have.
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