Tier 1 General ILR- split tax years

Hi,

Have any one in this forum had their previous income period as shown to Home office consisting of split tax years, hence different amounts when shown to HMRC. How do Home office deal with this. Mine is in two tax years, when I add all income and expenses, deducting the months not given to Home office, then the amounts given to home office and HMRC are same. But at a first look, the net incomes may look much lesser. Will they give opportunity to explain at PEO? Somebody advised me to amend tax returns to match figures given to Home office, which i dont want to do.

Please give your opinions.

jameji83 wrote:Hi,

Have any one in this forum had their previous income period as shown to Home office consisting of split tax years, hence different amounts when shown to HMRC. How do Home office deal with this. Mine is in two tax years, when I add all income and expenses, deducting the months not given to Home office, then the amounts given to home office and HMRC are same. But at a first look, the net incomes may look much lesser. Will they give opportunity to explain at PEO? Somebody advised me to amend tax returns to match figures given to Home office, which i dont want to do.

Please give your opinions.

PEO is not designed for discussion of cases; PEO is for straightforward cases.

Thanks for your reply.

Does that mean at PEO we spent more money, but dont get an opportunity to explain.

What do you suggest in the scenario? Apply by post, explaining all the background story and calculations?

jameji83 wrote:Thanks for your reply.

Does that mean at PEO we spent more money, but dont get an opportunity to explain.

What do you suggest in the scenario? Apply by post, explaining all the background story and calculations?

That is one way of looking a it.
You are not paying for a 'consultation'.

If not straightforward your application will be deferred to join the postal queue anyway (unless it fails on the spot);
so yes, advisable to make sure the bundle is both comprehensive and cogent.

As Gov UK website says...

Your application may take longer than a day if extra checks are needed

This post from a respected Moderator explains the situation well:
http://www.immigrationboards.com/indefi ... c#p1311487

Many thanks for the link and suggestions.

I am also looking to see if amending tax return shortly before ILR resulted in refusal, for that reason alone. Any idea?

Yes, under 322(1A) and 322(2) of the Immigration Rules.

Casa wrote:Yes, under 322(1A) and 322(2) of the Immigration Rules.

I am bit confused here. After going through the various related posts in this forum, I thought all are advising to sort out the taxes, by amending before applying. So did you mean, amending before applying could in the alternative be a problem.

Any experiences please

Would you have gotten an extension without this split-year income action? If not, then Casa's answer is a likely result, compounded with your current stay probably being curtailed. If that unusual tax reporting made no difference whatsoever in your immigration status (i.e. in getting a visa or any extension) then the act of amending your taxes alone won't necessarily be held against you or result in a refusal.

ouflak1 wrote:Would you have gotten an extension without this split-year income action? If not, then Casa's answer is a likely result, compounded with your current stay probably being curtailed. If that unusual tax reporting made no difference whatsoever in your immigration status (i.e. in getting a visa or any extension) then the act of amending your taxes alone won't necessarily be held against you or result in a refusal.

The period given to HMRC consists of extra 2 months not included in the period shown to HO. When the expenses during that period was taken, the net income to HMRC went down. Upon first look, it may be like lesser amount than declared to HO. If I could explain why this happened, by showing mathematics i hope they should understand. If applying by post, I dont now whether I should say these before hand is confusing me.

The Tier 1 guidance says, a person can show income from upto past 12 months out of last 15 months and a person need not be earning through out or the income could be from even shorter periods, eg: one month ..so obviously figure will vary for HMRC purposes, isnt it?

I have got similar situation. I am going to split my tax years as well.
If you check tax avoidance is legal practice in uk but tax evasion is illegal,
If you just explain each and everything to them they won't say anything, I have an accountant paper explaining each and everything to home office and an affidavit solicitor explaining as well.

But if you have send different closed accounts to home office then don't split your tax years if it's lies in 2 different periods and exactly same as you shown to home office you can ad the expense in the next two months if they are genuine . But explain everything. They understand everything.

We have so much fear because we think that might be one inch up and down will put us in trouble but if you explain them then there is no problem.

But still go to solicitors take advises from different people . Because it's matter of your future.

Rz2016 wrote:I have got similar situation. I am going to split my tax years as well.
If you check tax avoidance is legal practice in uk but tax evasion is illegal,
If you just explain each and everything to them they won't say anything, I have an accountant paper explaining each and everything to home office and an affidavit solicitor explaining as well.

But if you have send different closed accounts to home office then don't split your tax years if it's lies in 2 different periods and exactly same as you shown to home office you can ad the expense in the next two months if they are genuine . But explain everything. They understand everything.

We have so much fear because we think that might be one inch up and down will put us in trouble but if you explain them then there is no problem.

But still go to solicitors take advises from different people . Because it's matter of your future.

Hi Thanks,

When is your going to be due.. how many months difference you have?

What do you mean by different closed accounts to home office?

Pls explain

At the time of your initial application and extension have you ever mentioned your closing date of your accounts? Like did you mention that year end is April to April or any other closing year and showed expenses in that? For example you showed April to April closing year and you applied in febuarary and your one expense is in March which you want to show to Hmrc then it's fine. You can explain to home office. Ask your accountant to mention everything which is done in past as well. Home office is concerned whether you have declared your income to Hmrc or not even if it's in 2 split years . Again I will say explain everything in detail.


Mine is due in June.

Rz2016 wrote:Home office is concerned whether you have declared your income to Hmrc or not even if it's in 2 split years . Again I will say explain everything in detail.

Well the Home Office is also concerned the possibility of manipulating their finances/financial reporting to get a visa or extension that they would not have gotten otherwise. From the OP's explanation, I think this part won't be a problem.

I'll give you an example .

Home office needs earnings from last 12 months.
If someone applied in July so he will show his earnings from last Aug to July when he is going to apply. Now tax return files every 5th April so automatically when you gonna file your returns last April to this April will be filed in the current year and after April to June will be returned next year in April.
If you have shown to home office exact 12 months so it depends in which month you applied. If your earnings you shown to home office lies in 2 different years Of filing returns then there is no problem but if you have shown home office April to April or any months lies in April to April period than you cannot split into two years tax returns.
home office will check that have you declared your 12 months earnings to Hmrc or not , that 12 months can lie in two filing return years.
It's all about accounting rules. Which is debatable but yes splitting years intentionally in two years to avoid tax can trigger Hmrc to investIgate further. Like you file returns as your closing period Jan to Dec to avoid tax. But still tax avoidance is legal practice To reduce higher tax rates.
But here our problem is our future so please do not exceed in your expenses which you have shown to home office. Try to be closer and genuine to what you have shown.

Hi all,

Since this forum have helped me to prepare well for my Tier 1 ILR, I thought I owe to update on what happened to my case.

The discussions and comments scared me much though..

I successfully received my ILR same day without any hassles. My incomes during initial extension was high, other periods low and amount declared to Home office and HMRC different. The periods were slightly different and I did not want to amend or blame accountant. I just explained in my cover letter. No questions asked, took 2 hours ILR granted. Was so relieved. I had initially thought to use postal service, but thankfully now everything is clear.

My solicitor was very helpful and prepared a minimal bundle. They have experience in conducting appeals successfully wherein Tier 1 refused based on tax issues was succeeded in the tribunal. A friend of mine whose ILR was refused same day and leave curtailed, Admin review refused approached them. He was actually planning to return. The solicitors wrote in line to Judicial review and Home office responded seeking 3 months time to reconsider, but within just 2 weeks, ILR was straight away granted to our surprise. I would highly recommend them, but am unable to give their details here as I dont intend to break this forums rules.

My advice is thus dont give up, dont fear, no need to amend just to satisfy Home office, if you can explain it. Even if admin review refused, do go for judicial review.

Hope this is helpful for some one.

Hi I have a situation to discuss with all of you
I got my tier1 in Aug 2010 for two years. In Aug 12 I applied for extension. At that time I showed 20k dividend and rest as employment income from a corporate. My period was from Sep 11 to July 12. My limited company yearend was till Dec 12. As I started full time employment so my focus from my limited company diminished. Due to this reason my profits were gone down. I filed my Corp tax return till Dec 12 with profit of 10000 only paid tax accordingly And showed dividend of 10000 and put in my SA 2011-12 return. As 10000 is less than what I showed to HO in Aug 12.
In my other extension in 2015 my earning was salary only. I'm planning to go for ILR in Aug 16 with salary as only income.
My question is short fall of 10k in 2012 will affect my chances in ILR ? Although it was done on pure commercial reason. Plz share your thoughts on my case regards

Google accruals and prepayments.....

Hi, will be greateful if some one can share there experience on this -I have been granted successfully Tier1G twice. Income points were based on Permanent job, International income and Self employment.

Only thing which concerns me is self-employment. I was paying tax on my self-employment continuously 4 years. So even when Tier1 visa extension was not required my self-employment was doing well.
Recently I have requested sa302 and found out that i paid £350 less tax mean in one of the years profit was shown £1700 less and unfortunately that year is one of the extension years. Still my income points for that year is more what I required by totaling Job + Self employment + International income. The only reason paid less Tax was had dispute with one of the customer and had to give money back to him. My accountant advised at that time not to pay tax on that invoice. All other years paid full tax.

Do you think this will cause any issue? Is there any thing I can do to satisfy HO? For example letter from my accountant SA302 shows good record apart from one year where for HO and HMRC not exactly match.
Please kindly advice.
Thanks,

Hi jameji/memebers

I am also in similar situation the income i showed to home office is split between 2 tax years

I showed 40k as my earning in 2012 oct when i went for my 1st extension it is split in 2 tax years in sa 302

2011-12 and 2012-13 also ct 600 declaring the dividend which i showed to home office and hmrc.

Pleas give me any suggestions , contact number or solicitor

Thanks

In case of split tax years suppose the bifurcation of the 12 month period is as follows
A months in TY1 and B months in TY2 where A+B = 12 months
Total income declared to Home Office = X

HO will look at the following

(A/12)*X as compared to the Total income filed for Tax Year 1 and
(B/12)*X as compared to the Total income filed for Tax Year 2

The income per month for the period declared to Home Office during the tax years should be in line with the earnings for the 2 tax years which are outside the 12 month period. Any abnormal behavior should be well explained with evidence.

Thank you shiv, i did the calcuclation and its perfectly matching with my SA 302s as declared to HO

shiv_singh wrote:In case of split tax years suppose the bifurcation of the 12 month period is as follows
A months in TY1 and B months in TY2 where A+B = 12 months
Total income declared to Home Office = X

HO will look at the following

(A/12)*X as compared to the Total income filed for Tax Year 1 and
(B/12)*X as compared to the Total income filed for Tax Year 2

The income per month for the period declared to Home Office during the tax years should be in line with the earnings for the 2 tax years which are outside the 12 month period. Any abnormal behavior should be well explained with evidence.

Hi shiv_singh
Am new to this forum and after reading and reviewing many cases of resent refusal on ILR based on tax return issues.

Am now worried with the same issues on my forthcoming ILR based on previous earnings that falls in two financial year
Year.

See the below breakdown of my case. Am employed and also self employed .

(6kplus)+self employed(£52kplus ) =£59kplus

Earning year to HO - Jul 2011 to June 2012 =£ 59k-note: over the band for earning point as I only need 55 to 60k band
Tax return (sa302 for April 2011 to April 2012 =£28k plus.
Tax return (sa302 for April 2012 to April 2013 =£30kplus
Since earning's falls on two tax year within period claimed prior to extn.

Now on my tax return for self employment figures does not match with the 2nd tax year due to financial year was still ongoing as such expensis/ lost on that year causes different figures to HO within the 12months that falls in two financial year.But when you add the remaining of my pay job on the remains financial year is matches with figures of both HMRC and HO.

Do you think I still need an amendment to my self employment earnings as I still meet the threshold claimed to HO. Please I need your advice and other seniors as am new to forum.

Thanks

jameji83 wrote:Hi all,

Since this forum have helped me to prepare well for my Tier 1 ILR, I thought I owe to update on what happened to my case.

The discussions and comments scared me much though..

I successfully received my ILR same day without any hassles. My incomes during initial extension was high, other periods low and amount declared to Home office and HMRC different. The periods were slightly different and I did not want to amend or blame accountant. I just explained in my cover letter. No questions asked, took 2 hours ILR granted. Was so relieved. I had initially thought to use postal service, but thankfully now everything is clear.

My solicitor was very helpful and prepared a minimal bundle. They have experience in conducting appeals successfully wherein Tier 1 refused based on tax issues was succeeded in the tribunal. A friend of mine whose ILR was refused same day and leave curtailed, Admin review refused approached them. He was actually planning to return. The solicitors wrote in line to Judicial review and Home office responded seeking 3 months time to reconsider, but within just 2 weeks, ILR was straight away granted to our surprise. I would highly recommend them, but am unable to give their details here as I dont intend to break this forums rules.

My advice is thus dont give up, dont fear, no need to amend just to satisfy Home office, if you can explain it. Even if admin review refused, do go for judicial review.

Hope this is helpful for some one.

Hi Jameji83,

Is it possible to give your solicitors' details to me please? My tax has been splited into two years for 2012-2013 period. Even AR was failed. Really hopeless !!!

Thanks

Winnieling22 wrote:Hi Jameji83,

Is it possible to give your solicitors' details to me please? My tax has been splited into two years for 2012-2013 period. Even AR was failed. Really hopeless !!!

Thanks

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