Tax Return Amendments: Why, When, and How to Make Changes

In the rush of tax season, errors can occur. Whether you’ve discovered an overlooked deduction or received a late document that changes your tax scenario, amending a tax return can be a necessary step.

This article explores the process, reasons, and implications of amending a tax return, particularly focusing on the UK’s tax system managed by HM Revenue & Customs (HMRC).

1. Why Amend a Tax Return?

There are various reasons individuals or businesses might need to amend a tax return:

• Incorrect Information: Simple mistakes such as incorrect income amounts, misreported expenses, or wrong personal details.
• Overlooked Deductions or Credits: Discovering that you qualified for a tax relief or deduction after the original submission.
• Additional Income: Receiving further income details after the return, e.g., an additional P60 or a statement of interest from a bank.
• Change in Status: Life changes such as marriage, divorce, or the birth of a child might affect tax liabilities.

2. When Can You Amend a Tax Return?

In the UK, you generally have 12 months from the 31 January submission deadline to amend your tax return. So, for a return submitted for the tax year ending on 5 April 2022, you’d have until 31 January 2024 to make amendments.

3. How to Make the Amendment

• Online Users: If you filed your original return online, log into your HMRC online account. Navigate to the tax return in question and select the option to amend it. Follow the on-screen instructions and make sure to resubmit the return once changes are made.
• Paper Filers: If you filed a paper return, download a new tax return form from the HMRC website. Complete it with the amended details, and ensure you note on the form that it’s an amended return. Then mail it to HMRC.

4. Implications of Amending Your Return

• Possible Refunds: If the amendment results in an overpayment of taxes, you may be due a refund from HMRC.
• Additional Tax: Conversely, if the amendment reveals you owe more tax, you’ll need to pay the difference. Depending on when you amend the return, there might be interest and penalties on the additional amount owed.
• Documentation: Always keep detailed records of the amendments, including why you made them and any supporting documentation. This will be invaluable if HMRC has questions or if there’s an audit.

5. Special Cases

• Capital Gains Tax: If you’re amending details related to capital gains (e.g., from selling property or shares), you may need to use the ‘Capital Gains Tax summary’ form.
• Additional Forms: For other types of income or tax reliefs not covered in the main tax return, there might be supplementary pages or forms you need to complete and submit.

6. If You Miss the Amendment Window

If you discover an error after the 12-month amendment window, you can’t amend the return in the usual way.

Instead, you’ll need to write to HMRC detailing the year in question, what the error is, and why you believe there’s a mistake. Depending on the situation, HMRC may or may not allow the changes.

Conclusion

Amending a tax return might seem daunting, but understanding the process and reasons behind it can make it more manageable.

If you’re unsure about any part of the amendment, it’s always a good idea to consult with a tax professional to ensure compliance and accuracy.

Remember, the goal is to provide a true and correct representation of your financial situation for the tax year in question.