Foreign Pages - Rental income 20% tax relief for finance cost Glitch

Hi, I`m filling out the 2023-24 self-assessment now. I created a draft earlier with all the details including my Foreign pages where I wanted to claim '20% relief for mortgage interest'. The system correctly calculated my tax and the tax calculation had the 'minus Relief for finance costs' field. However, when I was going to update a few other information in my tax return last week, saved and recalculated the tax & noticed that the 'minus Relief for finance costs' field disappeared! I then deleted the tax return altogether and re-filled a new one, which made no difference. I cleared the cookies, tried a different browser but nothing worked, and found that the system is not providing me tax relief. Out of curiosity, I filled the rental income and 'finance costs' under the UK income (although I only have foreign rental income), the system calculated correctly this time and the 'minus Relief for finance costs' was visible! I again deleted the return, and started from scratch to fill my foreign pages but ended up having no luck as the 'minus Relief for finance costs' is still missing and my tax calculations are Wrong! Are you aware of any recent glitches? The fact that the field appeared correctly 2 weeks ago and disappeared recently makes me wonder if your software upgrade has bugs to fix!

I have the same issue and created a community account just for this. Issue: the online SA does not include the 20% basic rate tax relief for foreign propery finance costs in the tax calculation at all. This was working correctly when I submitted my 2022/23 SA, so it seems that HMRC has somehow managed to introduce this omission in this year's SA cycle. The best part is that this actually prevents me from submitting the SA online altogether! The submission fails HMRC's own, automated checks when I am trying to send the completed Self Assessment (with the tax due still being too high...). Instead of a confirmation of a successful submission, I am instead served the following error message: 6492 Self calculation case. The total tax due in box [CAL1] does not agree with the calculated value of £x,xxx.xx. The difference is £y,yyyy.yy. Please check.

Thanks, at least it is not just me... Also, I`m glad that the system prevents successful submission. I was unwilling to submit it and never knew that the error:6492 would pop up. I hope HMRC can fix this. Did you file a formal complaint? Do you think doing so will be useful?

I spoke to an HMRC specialist on this over the phone. She told me to submit the SA without the finance costs at all and she would then try to add the cost back in next week. So I now have a successful SA submission in the system but the calculated tax amount is still wrong. The alternative seemed to be filing the SA in paper form instead. I did note that this is something that will affect at least thousands of taxpayers. I will update here next week how that progresses. As you said, hopefully HMRC can fix this in the meantime.

So the specialist has advised you to intentionally file a wrong tax return and be liable to pay more tax putting more burden on yourself! Wow..! I am sure HMRC won't be ok if someone decides to declare less income and imposes penalty & interest on them if they were found guilty. I am thinking of making a formal complaint about this. If they have not addressed this by say 31st Sep, at least I will have a month left to file my paper return on time.

Hi Prabakarparth
Thank you for your original question
I'm sorry to hear of your IT issues. Nothing of a similar nature has been reported to our Online Helpdesk at Self Assessment: online technical support.
We would suggest that you either:
•    contact our helpdesk on 0300 200 3600 to advise of the issue and seek to resolve this with them or 
•    complete a paper version of the return along with income from property pages and send them in with a draft letter with your findings before the 31st October.
Thank you. 

How is that possible? I have reported it, as mentioned above. I have also called the above number and they eventually passed it on to a specialist. I spoke with her on Tuesday and another appointment is scheduled for next Monday. I have spent 10+ hours of my time on this, of which at least 2+ hours directly with HMRC, and apparently you are still not aware of the issue. As mentioned, this is something that worked correctly in last year's self assessment and is preventing any taxpayer with foreign property finance costs to file an accurate tax return online. I would think the number of affected users is in the thousands. Surely it is easiest for HMRC to fix this in the online form, rather than having to process thousands of additional paper forms? And that fix is presumably a straightforward rollback of whatever buggy update your IT team may have introduced recently.

Hi,

We would advise you to contact our online services team for advice. 

Technical support with HMRC online services

Thank you.

I`m with @TaxAdder. Rolling back the software update will make people's lives easier. Contacting the online services team ain't gonna help as I have wasted several of my valuable hours (again) only to get advice to 'paper file' this year or use commercial software for filings where the calculation is done correctly! I just can't believe these recommendations and interestingly, I am starting to see many advertisements on commercial software that are on sale now (I seriously hope that this is coincidental)!! I feel that law-abiding citizens should be respected by making their lives easier, and shouldn't let them scramble to pay taxes!

Just to follow up on the call I had with the HMRC specialist today. The issue is still ongoing, the specialist said she can now see my tax return in the system (with the incorrect tax amount due). Apparently she can add in the financing costs at her end now and I should the SA calculation updated before the end of the week. Whilst this is helpful for me individually, I would have thought that the scalable solution is indeed to get the IT team at HMRC to look into it and deploy a fix. As I noted before, I certainly have been speaking to HMRC on this on multiple occasions. It seems that no support case was created regardless so no-one is investigating it.

Hi,

Sorry, we cannot give a timescale as to when we will resolve these IT issues.

The deadline for filing a paper tax return for 2023-24.is midnight 31 October 2024.

You are correct, it would be more beneficial to fix any online issues, rather than have to manually process paper tax return forms.  

Thank you.  

Hi,
 

HMRC are aware of this issue and are looking to fix the the problem. Thank you for your feedback . Thank you .

Thank you for the update. Would it be possible to receive another update when the ETA for the fix is known or the issue has been addressed? I am currently waiting for the specialist to amend my SA so this is still ongoing for me. And the update will likely benefit any other users that come to this forum looking for a solution.

Hi ,
 

As outlined in previous responses, HMRC are at present looking into the issue, with a fix to the issue due shortly. Thank you for your feedback  .

Hello, there now seems to be 2 boxes re. Financing costs for Foreign property income: one to provide financing costs in the current year and one to provide financing costs brought forward in earlier years. The automatic SA tax calculation however seems to only provide relief utilizing current year financing costs and does not take account of financing costs brought forward. Would it be possible to fix this part as well please?

To add. The HMRC SA helpline advised to submit the tax return with the incorrect calculation and that they would correct on the back end however the website does not all submission with this error. An error code 6492 appears at submission and does not allow the submission of the return to HMRC.

I got around this issue by paying for a one-off commercial software to submit my Tax return. I wanted to ensure that my penalties are not accumulated for not filing a return on time. I`m not talking about the 31st Jan 2025 deadline but should there be any discrepancy between your 'payment in account' and actual tax liability, the deadline to pay is on the 31st July 2024 and if we go past then we will incur unwanted interest, etc.!

which software did you choose out of interest?

I used GoSimpleTax. But you may choose any HMRC approved Software for that purpose as shown here: https://www.gov.uk/government/publications/self-assessment-commercial-software-suppliers/self-assessment-online-commercial-software-suppliers