How To Correct Your Tax Return

Discovering an error on your tax return after filing can be stressful. But mistakes happen, and HMRC has processes for correcting them. The key is acting quickly and being transparent about the error.

First: Assess the Error

Before taking action, understand what went wrong and whether it requires correction.

What Counts as an Error?

• Incorrect figures or amounts
• Missed income sources
• Double-counted expenses
• Wrong dates or taxpayer information
• Claimed deductions you're not entitled to
• Mathematical errors in calculations

How Significant is the Error?

Small errors (under £100) that don't affect your tax bill significantly might not require formal correction if caught quickly. However, larger errors or those affecting your tax bill definitely need addressing.

Correcting Within HMRC's Self-Correction Period

You can make certain corrections yourself within specific timeframes.

The 12-Month Self-Correction Window

You can correct errors yourself if HMRC hasn't contacted you about that tax year and you act within 12 months of filing the return. If you discover an error before this period expires, you can correct it.

How to Self-Correct

For small errors: Contact HMRC and explain the error. Provide corrected figures. If the error is straightforward, they'll simply accept your correction.

For complex errors: You may need to file an amended return or provide detailed working showing how the error occurred and the correct position.

Filing an Amended Return

If you need to make formal corrections, you'll file an amended return.

When to Amend

• You have documents showing the error and the correct position
• HMRC hasn't contacted you about this tax year
• You're within the correction deadline (generally within your statutory record-keeping period)

How to File an Amendment

Most amendments are filed through the online self-assessment service. You can:

• Log into your self-assessment account online
• Select the tax year you're amending
• File an amended return with corrected information
• HMRC will process the amendment and recalculate your tax

Contacting HMRC Directly

Sometimes direct contact is better than filing an amendment online.

When to Call or Write

Contact HMRC directly if:

• The error is straightforward and easily explained
• You need clarification on how to make the correction
• You want to confirm the correction won't trigger further investigation
• You're unsure whether the issue is actually an error

Contacting HMRC

You can contact HMRC through:

• Phone: 0300 200 3300 (Self-Assessment)
• Written correspondence to your local tax office
• Online through your self-assessment account

The Disclosure Opportunity

If the error reveals a tax liability you didn't previously understand (you underpaid tax), you have options for disclosure.

Voluntary Disclosure

If you voluntarily correct an error before HMRC discovers it, there are different implications than if HMRC finds it through investigation.

Disclosure without penalty: If you correct a mistake you didn't realize you'd made, you typically don't face penalties — you just owe the outstanding tax.

Deliberate errors: If you knowingly filed an incorrect return, penalties may apply even if you correct it.

What to Expect After Correction

Once you've corrected your return, HMRC will process the amendment.

Timeline

• Online amendments are usually processed within a few weeks
• Complex corrections may take longer
• You'll receive confirmation once processed

Changed Tax Bill

If your correction changes what you owe:

• You overpaid: HMRC will refund the overpayment (usually within 4-6 weeks)
• You underpaid: HMRC will issue a bill for the outstanding tax

Payment Terms

If you owe additional tax, the payment deadline is usually 30 days from the HMRC notice. Late payment incurs interest and potentially penalties.

What if HMRC Has Already Started Inquiries?

If HMRC has already opened a formal inquiry into your tax affairs, the amendment process is different and more complex.

Don't Ignore an Inquiry

If HMRC has contacted you about your return, don't attempt to informally correct it. Instead:

• Acknowledge HMRC's inquiry formally
• Seek professional advice (accountant or tax advisor)
• Respond fully to HMRC's questions
• Disclose any errors or additional information discovered

The Inquiry Process

Formal inquiries can take months and are more structured than informal corrections. Professional representation becomes more important.

Penalties and Interest

If your correction reveals unpaid tax, you may face penalties and interest depending on the circumstances.

Interest on Unpaid Tax

Interest runs from the original due date to when you pay. For the 2023/24 tax year, interest is charged at the Bank of England base rate plus 2.5%. This adds up quickly if corrections are delayed.

Penalties

Penalties depend on whether the error was:

• Innocent mistake: No penalty if you correct it voluntarily before HMRC discovers it
• Careless error: 0-30% penalty if you weren't careful enough in preparing your return
• Deliberate error: 20-100% penalty if you knowingly filed an incorrect return

Professional Help with Corrections

Consider professional support if:

• The error is complex or the correction is substantial
• You're unsure about the correction process
• You're concerned about penalties
• HMRC has already contacted you

An accountant or tax advisor can:

• Assess whether correction is necessary
• Determine the right approach (self-correction vs amendment vs disclosure)
• Prepare documentation for HMRC
• Represent you in communications with HMRC
• Minimize penalties or argue for their removal

Key Takeaways

• Act quickly: Correct errors as soon as you discover them
• Be transparent: Voluntary disclosure is treated more favorably than discovery by HMRC
• Keep records: Document the error and your correction in case HMRC asks questions
• Get help if needed: Complex corrections or large errors warrant professional advice
• Don't ignore HMRC: If they contact you, respond promptly and fully

Tax return errors are common, and HMRC has processes for correcting them. The key is acting promptly and being transparent. If you've discovered an error and need help correcting it, or if HMRC has contacted you, contact Figures UK. We can assess your situation, guide you through the correction process, and protect your interests with HMRC.