Dateline London....It's not only the IRS that can cause grief. My friends here in London are experiencing something that would make your hair stand on end, unless, of course, you want it that way, and in which case I would recommend gel from Boots Pharmacy.

Apparently, hundreds of thousands of taxpayers that met this past January's self-assessment deadline still face interest penalties as well as possible late-payment fines, all because of an Inland Revenue blunder. Inland Revenue is akin to our Internal Revenue Service. (I like their name better)

You see, in England, employees have the option of paying their tax bill in full, or spreading it over the year via what is called a PAYE system. Of course, this option is only available to those who file before December 30th.

This year, those who used the online self-assessment service continued to be asked whether they wished to take advantage of the PAYE concession in the run-up to the January 31st deadline.

So, what happened? A mix-up occurred because Inland Revenue failed to remove the relevant click-on button on the Web site after the December deadline had expired. Those who clicked the PAYE option in January are now beginning to receive demands from Inland Revenue asking them for immediate settlement of their accounts, plus interest. Tah tah!

Rob Kinner said, "I knew I had to pay in the region of ₤900 tax (that's about $1450 here). This is very unusual for me but I had sold a property and had a large sum of money on deposit for some months before I bought another. I didn't even register to submit my return until January 19, so there is no question that I used an outdated form. I must admit I was surprised when I was offered the choice but I was clearly offered the PAYE option so I decided to accept. Now, I've had a curt demand for the outstanding sum plus interest. I will be furious if they fine me as well."

An Inland Revenue spokesman admitted that the pop-up box offering the PAYE option continued to appear after the December deadline but said it was quite clear from the notes elsewhere on the Web site that the option ceased at the end of the previous calendar year.

Sure! Go fight City Hall, eh?

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access