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The Government are to include legislation in next year's Finance Bill which will allow HMRC to waive interest and surcharges on tax paid late due to the floods. This legislation will be retrospective from 26 July. In the meantime, in recognition of the fact that the recent floods have affected a large number of taxpayers and those eligible for tax credits, it has been announced that HMRC will be able to:
- defer collection of taxes and duties, or agreeing instalment arrangements where customers are unable to pay as a result of severe hardship
- waive interest, surcharges and penalties for the period during which collection of tax or duty is deferred
- introduce practical arrangements where individuals and businesses have lost records in the flooding
- suspend debt collection proceedings
- defer compliance checks and investigations
HMRC will not charge penalties where they are satisfied that customers have missed deadlines as a result of the flooding and will similarly exercise their discretionary powers not to collect such interest and surcharges in the interim.
HMRC have also set up a helpline on 0845 3000 157 to deal with flood-related enquiries. This will be open seven days a week from 8 am to 8 pm. Tax credit recipients are asked to continue to use the helpline number 0845 300 3900.
HMRC news releases, 25 and 27 July 2007
