Case study: How moving home can cause tax trouble

Jeremiah was 88 years old when we first heard from him about his tax problem.  His vulnerabilities in addition to his age, meant he had had difficulty understanding his tax position and what he needed to do to resolve it.

His tax-related problems had started many years previously. When he was 65 his State Pension was cancelled by the Department of Work and Pensions because they did not have an up-to-date address. Jeremiah got by without his pension for several years, living off money from a house sale. It wasn’t until Jeremiah was 83 that he sought help from Maxine, a Housing Support Officer, and she helped him to reclaim his State Pension.

When his pension was reinstated he received a large lump sum payment, to cover the years that he had not received his pension. The large payment meant that Jeremiah would need to complete a Self Assessment tax return, something he had not done before.

Unfortunately, Jeremiah, having moved again, did not receive the letters telling him that he needed to fill out a tax return and as a result, he incurred a late filing penalty of £1,600 and a bill for over £30,000 in tax, even though he had already made tax payments to HMRC

Jeremiah and Maxine got in touch with us, and we worked together to gather information on Jeremiah’s financial situation. During our work we discovered that the £30,000 tax bill was incorrect and rather than a tax bill of over £30,000, Jeremiah was owed a repayment of some of the tax already paid which amounted to just over £26,000. The financial and emotional benefit of this was greatly appreciated by Jeremiah.  

This entry was posted on Friday, May 24th, 2024 at 12:45 pm and is filed under Uncategorized. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.