Advising HMRC of change in circumstances: what you need to know
Life changes happen all the time, and many of them affect your tax position. Therefore, you should always keep HMRC informed. Otherwise, you could pay too much tax or face an unexpected bill later.
Relationship and family changes
Firstly, you must tell HMRC about key changes in your relationship. These include:
- Getting married or forming a civil partnership
- Divorcing or legally separating
- Stopping living with your spouse or partner
Furthermore, you should report these changes as soon as possible. Otherwise, you may pay too much tax or receive an end-of-year bill.
In addition, if you claim Child Benefit, you must tell HMRC separately about family changes. Consequently, keeping both records up to date protects your entitlements.
Bereavement and address changes
Sadly, if your spouse or civil partner dies, you should contact HMRC promptly. Similarly, you must report any changes to your income following their death.
Moreover, you should always tell HMRC when you move home. This way, they can update your records and send correspondence to the right address. However, HMRC usually receives updates automatically when you apply for a Gender Recognition Certificate.
Changes to your taxable income
Advising HMRC of change in circumstances also covers your income. Although your employer or pension provider reports most employment changes, you must report others yourself. For example, tell HMRC if you:
- Start or stop income from self-employment or property
- Receive taxable benefits, such as the State Pension or Jobseeker’s Allowance
- Get job benefits, such as a company car
- Earn income above your Personal Allowance
Other reportable income
Additionally, you must report certain one-off events. These include:
- Lump sums from selling shares or property that is not your main home
- Income from inherited property, money or shares
Payments on account
Similarly, if you make self-assessment payments on account, keep HMRC informed. For instance, if you expect a significant income drop, you can often reduce your payments. Therefore, contacting HMRC early avoids overpaying.
Here to help
Not sure whether a life change affects your tax position? Contact our team today for friendly, expert advice on advising HMRC of change in circumstances. We will help you stay compliant and pay only what you owe.
