SAM121260 - Returns: individuals returns: unsatisfactory individuals returns

General
Exceptions
Supplementary Pages where no original return has been received
Points to note
All cases

General

The return must 

• Be electronically filed, or be on the HMRC paper form, or be a computer generated version which is identical to the official HMRC form. Note: For years up to, and including 2006-07, an approved alternative (but not faxed) was accepted
• Be the correct version of the form for that year and not have been manually altered to form a substitute for another years return
• Be signed by the correct person, including a person acting in any capacity. For further information see subject Records: maintain taxpayer records: maintain capacities (SAM101190). Note: The return may be completed in ink or pencil, either is acceptable although completion in ink is preferable. Do not refuse a return because it has been completed in pencil
• Include all supplementary pages indicated on the Main Tax Return (SA100) as being necessary. Note: If a form P60, P11D or letter with additional information is enclosed, and either an Employment page has been part completed, or not submitted at all, do not treat as unsatisfactory as the return can be repaired using the enclosed information. However a spreadsheet, table or list providing details which should be on separate supplementary pages (multiple employments, self-employments, partnerships) is not acceptable. (The exception being a director with no income from office and who has entered a note to this effect in the white space). See Points To Note below
• Include details in all boxes which should have been completed on the return, unless the information is enclosed with the return, in which case you can capture that information into the correct boxes

• • The Foreign page asks for figures to be entered in sterling and the amount is shown in foreign currency or where the country or territory code has not been entered

• • The Minister of Religion page shows boxes MoR 5 or 13 have been completed and box MoR 20 shows a figure which is greater than £8500 but boxes MoR 27 to MoR 35 have not been completed

• Include, where either a Capital Gains Summary (Main Tax Return) or SA108 (Short Tax Return) has been provided, a capital gains computation. This computation may be included either in the additional information box on the Capital Gains Summary or as an attachment to the return
• Include, where a Residence - Remittance basis page has been submitted, Helpsheets 302/304 in support of a double taxation relief claim
• Not include, on a Short Tax Return (SA200), turnover of £70,000 or more from Self Employment, or £70,000 or more from Land and Property
• Not include entries

• • ‘Per attached’ where a spreadsheet, table or list providing details which should be on separate supplementary pages (multiple employments, trades, partnerships, accounting periods), has been enclosed. This is not acceptable
  • ‘To follow’. This indicates that required information has not been filed
  • ‘Per enclosed accounts’ and the SAI has not been completed correctly

An unsatisfactory return is a return that fails to satisfy the filing requirement of Sections 8 and 8A TMA1970 as stated in the 'Notice to File'.

Section 8 TMA1970 requires that returns provide information reasonably required for the purpose of establishing the amounts in which a person is chargeable.

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Exceptions

The exceptions to these general rules are

• The omission of the amount of Class 4 National Insurance Contributions due. This is not an error and does not make the return unsatisfactory
• The omission of information from the un-numbered boxes above box 9 in support of a Tax Credit Relief claim on the Foreign pages. This will not make a return unsatisfactory if

• • Liverpool Large Business Office has agreed the omission with the partnership

• • The entry is supported by a claim to partial exemption from UK tax on income by a dual resident

More detailed information is available in this section of the SA Manual on the following subjects:

• (This text has been withheld because of exemptions in the Freedom of Information Act 2000)
• Standard Accounts Information: Subject ‘SAI: Completion of Individual’s Return’ (SAM121220)
• Mandatory boxes: Subject ‘Mandatory Boxes: Individuals’ (SAM121170)

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Supplementary Pages where no original return has been received

Where supplementary pages are received without a satisfactory return, and the tax return for the appropriate year has not been received, no action must be taken in relation to the information given and the pages must be returned to the customer/agent with a covering letter to explain the reasons why.

Explain that the information shown on the page(s) cannot be accepted without a satisfactory completed return, submitted online or on paper, for the appropriate year. You should also advise the customer if a previous unsatisfactory return has been sent back to them, and when it was sent, and that the relevant completed pages should be sent back with that return.

Enclose a blank paper return, as appropriate, or direct the customer to the HMRC website to enable them to download the relevant form(s), and make an SA note of the action taken in case the customer makes contact by phone.

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Points to note

PAYE taxpayers

The taxpayer may tick Question 1 on page TR 2 of the SA100 to show they were an employee, office holder, director or agency worker in the return year but not complete and return the Employment pages. If there is no other indication of employment, for example a form P60, P11D or a letter with additional information enclosed with the return, treat the return as satisfactory. Remember that a taxpayer does not have to complete the Employment pages where

• No income was received during the return year from that employment

• The taxpayer was not resident in the UK and the employment was performed wholly outside the UK

Agents have been advised to enter an explanation in the Additional Information box as to why the Employment pages have not been completed in these cases.

Capital Gains cases

The taxpayer must 

• Complete the Capital Gains Summary (where the requirement to report these gains is met) if they have disposed of shares, securities, property or other assets in the year, or they otherwise have gains for the year

• Enclose computations. These may take various forms and may be included in the additional information box 35 of the Capital Gains Summary, on a separate schedule or on a completed working sheet

Take care when reviewing such a case for completeness. The tax return must not be treated as unsatisfactory where the taxpayer or agent follows this guidance.

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All cases

All cases where it is considered an unsatisfactory return has been received should be reviewed for the next appropriate action by an experienced officer.

If, following the review, it is considered that the return could in fact be treated as satisfactory, the experienced officer should

• Log the return
• Identify all omissions and errors
• Obtain all information possible from the return and enclosures and, where the information can be easily identified, make repairs to the return entries

If, following the review, the return is still considered as unsatisfactory, no repairs of obvious errors should be made and the form should be sent back without any amendment. If it does not satisfy the requirements then it is not a return and we can only correct a return.

Note: Where a form SA200 is unsatisfactory because it includes income exceeding £70,000 from self employment or £70,000 from land and property, a form SA100 is required and should be issued to the taxpayer.

An unsatisfactory return must be rejected and sent back to the taxpayer or agent who submitted it (only to an agent where 64-8 held). Where an agent is acting, a letter should also be issued to the other party notifying them of the action taken.

Note: If, in a case where an agent is acting, it is not possible to tell who submitted the return, it should be sent back to the taxpayer as it is their ultimate responsibility to ensure that a satisfactory return is submitted.

Returns received before the filing date, which are sent back on or after 18 October (or in the corresponding period up to any other filing date), that are identified as unsatisfactory should not be logged whilst the return is

• Sent back for completion by the taxpayer or agent who submitted it

• For completion of a further return in certain SA200 cases

In Short Tax Return cases, the scanned image can be printed off and returned. If necessary a blank SA200 should be sent back with it.

These returns will have been marked with a red spot for identification purposes. On receipt of such returns, the SA Notes should be reviewed for the date the return was sent back as unsatisfactory. The necessary action should then be taken in accordance with the Action Guide (SAM121261).

Notes: 

All returns that are rejected must be accompanied by a letter explaining why it is being sent back. The correct letter should be issued in accordance with the table below. Where more than one return for the same taxpayer is being sent back and the reason for rejection differs for each return, if the SEES letter cannot be adapted appropriately, consider sending a separate letter with each return or sending a free format letter using the SEES letters for reference.

Note: Where a period longer than 21 days is to be allowed, the relevant letter SA604 should not be used. A locally produced letter should be issued stating the number of days considered reasonable in which to send back the return. 

For the avoidance of doubt the 21 day period of grace, or longer where allowed, only applies where the return is unsatisfactory as a result of a genuine oversight. It does not apply where the return is deliberately unsatisfactory, in an attempt to take advantage of the period of grace. For example, the 21 days, or longer where allowed, do not apply if a return is deliberately sent in without a relevant set of pages, to buy a little more time to complete those pages. Nor does it apply if a return is deliberately sent in without a signature, to buy a little more time to obtain the signature. If you come across a case where an unsatisfactory return is sent in several years running, refer it to an experienced officer to decide whether the 21 day period of grace, or longer where allowed, can be given or not.

Note: Revenue Calculation cases 

In cases where

• The signed return is received before 31 October

• The taxpayer has requested Revenue Calculation

You should advise the taxpayer that HMRC will still calculate the tax due on request, but cannot promise to do so before 31 January following the end of the SA year