Business : HMRC tax letters

HMRC has announced that 6 million people have been incorrectly taxed. That means that 6 million letters are being sent to taxpayers with the good or bad news. Most were overtaxed and will get a refund (averaging £400) but about a quarter will be asked to cough up around £1500 each.

So what do you do if you get a tax letter from HMRC?

Any letter from HMRC can be stressful because it could contain a demand for extra tax or some threat or penalty you don't even understand. One thing's for sure - few of us look forward to a letter from the tax people.

The first thing to do is open the letter. Don't be afraid of it. Not opening the letter will not change anything. And look on the bright side - there's a three in four chance that you will be one of the lucky ones.

If you are lucky and it all makes sense, follow any instructions you are given about claiming your refund - in most cases it should be automatic but it's best to make sure.

If you are being told that you might have to pay more or you don't understand what the letter says, or how the calculations are arrived at, fax or e-mail it to the experts at Small Biz AccountsTM and we will review it for you, explain it to you and advise you what to do next.

Remember, a calculation is not a demand to pay. You still have options.

We've got a special page for people worried about tax letters.

Alex Redmond

Small Biz Accounts