I haven’t declared my income for the last few years – what do I do?

by | Jun 13, 2023

If you haven’t declared previous years’ income and don’t know what your next step is, don’t panic.

Admittedly, failing or forgetting to declare isn’t ideal, but it could be for many reasons. We’re not here to tell you off — rather to try and help you resolve the situation.

HMRC isn’t the bad guy, so you’re better off declaring your income as soon as possible if you want to stay in the Government’s good books. Failing to do so could result in an investigation or worse – prosecution.

If you’re unsure how to get the ball rolling, this article should clarify things.

Get in touch with an advisor

First, if you have years of undeclared income, you’ll want to make the first move. If you were to wait for HMRC to make the discovery, you’re likely to be seen as a deliberate tax avoider, even if it’s not the case.

It may sound stressful, but you don’t need to do this alone. Seeking the help of a professional is the best course of action before approaching HMRC. Having the professional advice of a tax expert can help alleviate some of the stress and reduce your preparation.

As HMRC will treat it as a tax enquiry, you’ll want a professional team that offers tax investigation services, so when HMRC does come knocking, you’ll be ready.

Backdate your assessments

There are genuine reasons why someone may not declare their income to HMRC, including:

if you were unsure you needed to declare the income,
you didn’t know how to, or
you couldn’t pay the tax bill.

No matter the reason, now’s the time to rectify the situation. If you’ve already submitted a self-assessment tax return, you can update it to include any missed income.

If you don’t already send a self-assessment, you can register and declare up to four years’ worth of income. However, you’ll have to do this on four separate returns — this whole process is fairly time-consuming, so maybe consider contacting a member of our team for assistance.

We complete dozens of self-assessment tax returns every year for our clients, so why not add yours to the list? We’ll register you and stay on top of your regular reporting.

Will I go to court?

The short answer is no, probably not, especially if there’s no fraudulent intent behind not declaring your income. If you tell HMRC about your missing tax payments as soon as possible, it’ll likely treat you with some leniency. Specifically, HMRC should lower its tax penalties the more you help out with its investigation.

But if you owe a considerable amount or have put off telling HMRC for a while, you could be seen as a tax avoider, even if it isn’t the case. If this happens, you could face prosecution.

The first thing you should do is seek legal advice. Our support services can act as a lifeline in such a stressful situation. Furthermore, our fee protection insurance will help minimise the costs of going through the legal process, as you can never be too sure how long these things take.

If you think that HMRC may want to open a full enquiry, or if you want to get ahead and declare your income, there’s no time like the present to take action.

We’ve got your back

There could be multiple reasons you didn’t declare your previous income, especially if you’re new to the process. If you find yourself in this position, don’t worry: we’ll be there to help get things up to date.

If you need help declaring your past income or require support when dealing with an HMRC enquiry, get in touch. We’d be happy to help.

You deserve more

When you start seeing results, you’ll have more time to focus on what matters most. That’s the joy of a great partnership.