'Confusion' over P35 question six

Date: 23rd April 2008

HM Revenue and Customs (HMRC) has revised its guidance regarding question six on the employer's end-of-year P35 return form.

According to Accountingweb, there has been considerable confusion over the way in which question six, regarding "service companies", is phrased on the form.

Nichola Ross Martin, Accountingweb's tax editor, explains: "Use of the description "service company" is very confusing for your average employer who is not a tax expert. Taxpayer guidance must be foolproof and unambiguous."

Due to the confusion surrounding the phrasing of the question, HMRC says it will not use this year's question six answers and those who feel they may have answered incorrectly are not required to re-submit their forms.

Ms Ross Martin has welcomed the news; however, she adds that it "has probably come a little late."

The new tax year started on April 6th.