Late Paper Partnership Tax Return Penalties

Ronnie Registered Posts: 20 New contributor 🐸
I filed a couple of paper partnership tax returns in December, whilst using HMRC's online filing system to file the self-assessment tax returns for the partners. The two partners of one partnership paid their tax bills in full prior to 31 January 2011. The other partnership received a tax rebate due to a trading loss.

HMRC have just issued a Notice of determination of penalty for a late partnership tax return for year ended 5.4.2010 to both partnerships (though I have received a copy for only one of them). My understanding is that so long as the tax is paid in full by 31 January, or no tax is due, then no £100 penalty is imposed for submitting either a self-assessment or a partnership paper tax return after 31 October. Am I correct?

What is the best way to get this sorted? Telephone the number on the notice, telephone the agent dedicated line, or write to the issuing office (Glasgow)?

Interesting that the letters are dated 15 February, but were received on 26 February!

I normally get these paper and online returns done in July, but various circumstances delayed them this year...


  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Ronnie wrote: »
    My understanding is that so long as the tax is paid in full by 31 January, or no tax is due, then no £100 penalty is imposed
    This is for SA100s only.

    As there is no tax payable on a partnership return, the concession does not apply - if it is late then a £100 penalty per partner is due.

    I don't think there is much you can do about it.

    Have you looked into 3rd party software for filing SA800s online?
  • Pppyddger1
    Pppyddger1 Registered Posts: 7 New contributor 🐸
    Partnership Returns

    Agree with previous post, I found out the hard way about partnership nil returns, Suggest you buy Partnership software for as little as £15 + VAT for one return, for £25 for 5, much cheaper for whoever is paying you or the client that the £200 penalties. Too late for this year though
  • Ronnie
    Ronnie Registered Posts: 20 New contributor 🐸
    Many thanks for your replies. I can't believe that this delay is going to cost me £100 per partner, ie £400 !! The partners won't want to pay, as they relied on me to complete the tax returns as required. I've had a foul 2010 year - bereavement, fractured foot, illness, knee operation, dog problems, amongst other personal issues. And now this. I only work part-time these days, so £400 is a large proportion of my income.

    Has anyone managed to make a successful appeal?
  • Monsoon
    Monsoon Registered Posts: 4,071 Beyond epic contributor 🧙‍♂️
    Hi Ronnie,

    I'm sorry to hear you've had a hard year, it's always galling when personal circumstances cause issues like this (I had to pay a penalty on someone's behalf yesterday due to my mistake so I do sympathise).

    If it is definitely your delay that meant they could not be filed by October 31st on paper, then alas you wil have to stump up. However, when did they get their information to you? If they were late in presenting it to you then you might be able to shift some of the penalties onto them, as you can't be expected to prepare things at short notice. It all depends on your letter of engagement, when you state you need the information by, any written/email traffic between you where you state you won't be able to complete things due to your unfortunate circumstances etc and warning them of possible penalties. And indeed whether you will keep the client if you shift some or all of the penalties onto them if possible. Have a look and see what was said to see if there is any leeway with this.

    You can indeed appeal and cite your extenuating circumstances - if you don't ask, then you don't get! - but I wouldn't get your hopes up. I would mention that as all personal tax returns were filed on time and tax paid, and that the returns were filed before 31st January even if on paper, then £400 in total is a bit excessive, and see what they say.

    Best of luck, £400 is a bit of a steep one as a lesson learned, so I hope you manage to mitigate it somehow.
  • payrollpro
    payrollpro Registered Posts: 427 Dedicated contributor 🦉
    This partnership return thing is a nightmare. We have no partnership clients but the three of us have the £100 penalty each because we chose the wrong software and are still trying to file.

    Don't HMRC have a responsibility to make sure the software they list on their website will actually work. I don't know which one we chose because I was not responsible for filing it but we paid for the use of it and was given the impression it had worked when in fact it hadn't. It's £300 down the pan for no reason at all.

  • Ronnie
    Ronnie Registered Posts: 20 New contributor 🐸
    Thanks again for your comments. I am going to try an appeal, particularly as the individual tax returns were filed online using HMRC's software. I've never had any problems getting the books from either of these partnerships, and I've always filed the tax returns around July in the past. One partnership ceased trading. The delays were my responsibility, so I don't think I can ask my clients to contribute.
  • paulr
    paulr Registered Posts: 48 Regular contributor ⭐
    Partnership paper returns

    Sorry to hear about the fines but HMRC will not accept Partnership paper returns
    after the original paper return deadline.
  • deanshepherd
    deanshepherd Registered Posts: 1,809 Beyond epic contributor 🧙‍♂️
    This recent appeal won by the taxpayer may be of interest..

    Davies Software Services
    Income tax – late filing of partnership return – penalties – paper return filed just after online filing date – unsuccessful attempt to file online – need for third party commercial software to file online – Express Agency [2010] TC 00368 distinguishable – taxpayer found words used in notice to file ambiguous and not clearly stated – taxpayer had reasonable excuse – taxpayer's appeal allowed – Taxes Management Act 1970, s. 93A(7).

    [2010] TC 00428
    Decision released 12 March 2011.
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