Director’s tax return

HMRC issued a notice to compete a tax return to the director of a loss-making company. Her only worldwide income is a salary from the company of £5 715 (2009/10).

I contacted HMRC to advise that no liability would be due for 2009/10 and that the processing of the return was just wasting time and resources for myself my client and HMRC (i.e. the taxpayers who are funding the organisation in these financially challenging times).

I pointed out that I was not aware of legislation stipulating that returns had to made for taxpayers where there was no liability. After three chasing letters HMRC have now replied quoting TMA 1970 s 8(1) i.e. that ‘a taxpayer may be required by a notice given to him by an officer of the board to… make a return’.

Their letter goes on to say...