Do your taxes need a health check?

HMRC have launched a tax amnesty for health professionals to disclose undeclared income.

Under the “Health and Wellbeing Tax Plan” (“HWTP”), any medical professional can come forward and declare unpaid tax before the end of the year and pay a reduced fine of 0%-35% of the tax due, rather than the 100% penalty faced by those who do not use the facility and are subsequently investigated by HMRC. The penalty will be paid on top of any tax due and payments must be made before 6 April 2014.

HMRC guidance specifically references professionals working in physical therapy – eg physiotherapist, chiropractor, chiropodist, osteopath, occupational therapist, alternative medicine or therapy – eg homeopathy, acupuncture, nutritional therapy, reflexology, nutrition and other therapy – eg psychology, speech therapy, arts therapy. Although the list is not exhaustive. The disclosure facility is not aimed at doctors and dentists who were covered by a previous amnesty in 2010.

Whilst most medical professional can be confident that they are paying the correct amount of tax, some may have let their tax liabilities fall by the wayside while they focused on making their business a success. Equally, as our tax regime gets ever more complicated, errors and omissions can creep in to the affairs of even the most conscientious taxpayer.

In some cases, it may be possible to apply the terms of the amnesty to non-medical professionals however this will depend on individuals circumstances and must be reviewed on a case by case basis.

As usual with these targeted campaigns it is anticipated that after 6 April 2014 HMRC will focus their sights on taxpayers who they have reason to believe should have participated in the HWTP. So now is the perfect time to review your tax affairs and ensure everything is in order.

If you would like our assistance with this, or in making a disclosure using the tax plan, please contact us at the earliest opportunity.