Question over Brown's tax bonanza

IF YOU were fined £100 for missing the 1 February deadline for returning self-assessment tax forms, it will be of cold comfort to learn you are not alone - the Inland Revenue reckons it will gain about £80m from some 800,000 people in the same position.

However, tax advisers say the Revenue may have got its sums wrong. The number of people who missed the cut-off date is boosted, it is claimed, by thousands of returns sent out in error to people who do not earn enough to pay income tax or who may even be dead.

'I doubt the integrity of Inland Revenue figures for self-assessment returns, because they have severe computer and office rationalisation problems, as well as a go-slow by staff,' said Chas Roy-Chowdhury, head of taxation at the Association of Chartered Certified Accountants:

'The combination of these problems means that the Revenue unnecessarily sends out thousands of self-assessment returns for completion by people who do not qualify and they simply bin the forms. Other taxpayers are now dead, but the Revenue has yet to catch up.'

Last year, the Inland Revenue said 850,000 self-assessment forms were overdue, from the nine million sent out, supposedly netting Chancellor Gordon Brown £85m to set against the lost revenue. Current Inland Revenue estimates put the number of late returns at a shade above last year, but it is this similarity that is leading tax advisers to doubt the arithmetic.

In the run-up to the 1 February cut-off, the Revenue spent £5.5m on adverts in which taxpayers were urged to return their forms and pay their tax on time by Mrs Doyle, the nagging housekeeper played by Pauline McLynn in the Channel 4 TV series Father Ted. At first the Revenue thought it would have compiled the figures for missing returns by 8 February, but missed the deadline.

'Although we are still auditing the figures it is clear the slight downward trend of recent years has been reversed. We apologise for the delay in providing final figures,' the Revenue said on Friday.

The original, 31 January cut-off for tax returns was extended by a day after problems at three major tax centres, including the Liverpool Riverside District, which handles those from people living and working in the South East.

The Inland Revenue has hired 2,000 extra 'revenue receivable managers' with orders to target those whose self-assessment returns are late. Failure to return a single phone call may be enough to launch an investigation into your affairs, and debt collectors are under orders to find against the taxpayer in 76% of cases.