HMRC is writing to some company owners, otherwise named as shareholders, from 4 February 2024 to query with them whether they may have under-declared dividend income.
HMRC has reviewed the company’s reserves in the Company’s Balance Sheet and can see that although the Company has made a profit the reserves have fallen, (which one would not expect), this would suggest that a dividend has been paid out.
HMRC has asked the company owners to whom they are writing to either report any under-declared dividend income or tell HMRC if there is no further income to declare.
HMRC has advised in their letter to the shareholders that they should use an online disclosure facility. The online service requires the user to register for the facility, they will then be sent a payment reference number, and they can pay anything that they owe, including interest and penalties.
Payment should be made within 90 days of receiving the payment reference number to ensure that their tax affairs are up to date.
If the recipient believes that they do not have any additional income to declare, they can advise HMRC of this by telephone or by email to the address provided in the letter.
HMRC also advises in their letter that if the recipient does not respond then HMRC may open a compliance check into their tax affairs and charge higher penalties.
If you have received one of these letters and feel that you would like some advice on how to respond to HMRC, we would be more than pleased to help and so please do contact Nockolds on 0345 646 0406 or complete an online enquiry form and a member of the team will be in touch.