HMRC’s list of exclusions from online filing for 2016-17 continues to multiply. The list of exclusions has been updated with the publication of version 4.0 of the document. There are now a total of 32 live exclusions on the list including 5 new additions to the list. Many of these issues exist as HMRC has been unable to update its software to properly deal with all the various combinations arising from the changes to the dividend tax, personal allowance and savings allowances from April 2016. It is thought that a relatively small number of taxpayers will be affected by these issues. However, this will cause problems for those affected and some will be required to step back in time and submit tax returns in paper form.In other words, the legislation in these areas has outpaced the ability of HMRC’s programmers to update their online filing software.The exclusions include:Taxpayers with savings and non-savings income over £32,000 of which the non-savings income is between £11,000 and £16,000.The basic rate band is extended incorrectly for dividends of more than £118,000 where the taxpayer is liable to additional rate tax.In a recent update HMRC said:’HMRC is working hard to ensure that no tax is incorrectly assessed for a very small number of self assessment customers, who have a very unusual combination of income types. HMRC is committed to helping customers file online for 2016/17 and is discussing how best to achieve this with agent representatives and software providers. Further information will be provided, as soon as it becomes available.’Planning note: If you are affected by the inability of HMRC’s software to cope with your return, and you need to file a paper return for 2016-17, HMRC will accept the late return of a paper return up to 31 January 2018 on the basis that the taxpayer had a reasonable excuse for late submission. HMRC advises that a reasonable excuse claim should be sent together with the paper return. HMRC has said that they expect to be able to fix these issues for 2017-18, and subsequent tax years.Please call if you need help in dealing with these formalities.