The Second Incomes Campaign is such an opportunity open to individuals in employment who have an additional untaxed source of
income that they need to declare to HMRC and pay the associated tax.
Examples could include:
- fees from consultancy or other services such as public speaking or providing training
- payment for organising parties and events or providing entertainment
- income from activities such as taxi driving, hairdressing, providing fitness training or landscape gardening
- profits from spare time activities such as making and selling craft items
- profits from buying and selling goods, for example regular market stalls, boot sales etc
This disclosure facility is intended to be used for all tax years and to report all income not previously declared to HMRC except income in the current (2017-18) or previous (2016-17) tax year. Income for these tax years should be reported on a self-assessment tax return. Tax returns already submitted can be amended within 12 months of the statutory filing date.
Individuals and companies should register for self-assessment in order to deal with periods that cannot be included in the disclosure.
Whether the errors were due to misunderstanding the rules or deliberately avoiding paying the right amount HMRC is keen to encourage people to come forward and admit any inaccuracies rather than wait until they uncover those errors.
When you make a disclosure you can tell HMRC how much penalty you believe you should pay, for this reason it’s worth taking expert advice on what to include in the details submitted. What you pay will depend in part as to why you have failed to disclose your income. If you have deliberately kept information from HMRC you’re likely to have to pay a higher penalty than if you have simply made a mistake.
You may not have to pay any penalty at all but if you do it is likely to be lower than it would be if HMRC finds out you haven’t paid enough tax. We can work with you to negotiate a time to pay arrangement as if if your circumstances warrant it, you will be able to spread your payments.
You can find out more on the .Gov website but do get in touch to find out how we can assist with declaring a second income which may mean you have unpaid tax to pay HMRC.
