Naturalisation - Should my tax balance be £0.00 ????

[jason77]

Dear Experts

I am now eligible for Naturalisation.

I am self-employed and my tax is due on 31 January 2012. I have paid some but not all my tax so far because i had little work available to me and by 31 January i may not have paid all my tax due. All previous years are up to date as i was a PAYE employee.

My question is: When i submit my Naturalisation application, Is it strict that my tax balance should be £0.00 at the time of application or does it count that i have been paying something towards bringing my owings down?

[ban.s]

No, don't need to be zero balance. Even though we all pay regular taxes though PAYE or other means, full tax liabilities can only be calculated at the end of the financial year. If you paid more tax, HMRC will owe you the balance or vice versa.

As long as you have an agreed tax arrangement with HMRC and you are paying as per your tax code, then you are fine. Doesn't matter whether you have tax underpayment or overpayment.

[John]

ban.s, we have been told by jason77 that he is self-employed so PAYE does not apply. It seems that the Self Assessment tax return has been submitted, and thus the tax liability has been calculated, and thus the amount payable on or before 31.01.13 has been calculated.

On the form AN there is a requirement to enter the NI number, and in the declaration you sign at the end of the form you authorise UKBA to contact HMRC. You should have no tax arrears. So if you think that some of your 31.01.2013 liability might still be outstanding on 01.02.2013 then it might be best to delay making your Naturalisation until all the tax due has been paid.

Or put it another way, pay your tax first, before paying the application fee for Naturalisation.

[ban.s]

John, i agree that for the OP, PAYE is not applicable in this instance.
We do authorise UKBA to contact HMRC but my interpretation of the rules is that we need to ensure that our tax affairs are in order - it doesn't mean we have to have zero tax liability at the time of application. There could be outstanding tax liability but as long as we have discussed and obtained an agreed arrangement with HMRC we should be fine.

happy to stand corrected thought if there was any refusal because of this.

[John]

Of course we do not have any idea of the figures here. Might the amount unpaid on 01.02.2013 be £10, £500 or £5000 or more?

If £500 for example, I still think it would be better to pay off that tax liability first, ahead of paying for the cost of a Naturalisation application.

[ban.s]

true - self employed applicants should try to discharge all tax liabilities and submit a clean application instead of relying on discretion - but if the amount due is too big and/or have additional complexities, speak with HMRC first and obtain written agreement on tax obligations before submitting an appl

[jason77]

John - Thank you very much for your response. It is very much appreciated!

ban.s, we have been told by jason77 that he is self-employed so PAYE does not apply. It seems that the Self Assessment tax return has been submitted, and thus the tax liability has been calculated, and thus the amount payable on or before 31.01.13 has been calculated.

On the form AN there is a requirement to enter the NI number, and in the declaration you sign at the end of the form you authorise UKBA to contact HMRC. You should have no tax arrears. So if you think that some of your 31.01.2013 liability might still be outstanding on 01.02.2013 then it might be best to delay making your Naturalisation until all the tax due has been paid.

Or put it another way, pay your tax first, before paying the application fee for Naturalisation.