HM Revenue and Customs (HMRC) customers are at risk of facing a fine worth up to £900 if they don’t take action as soon as possible.
The government department revealed that over 11.5 million individuals successfully filed their Self-Assessment returns on time, while approximately 1.1 million missed the deadline last week. By the cutoff date of midnight on January 31, HMRC received 11,509,810 submissions.
HMRC is now advising those who are yet to file to do so promptly and settle any taxes due. For those struggling to pay their tax bill in one go, there’s an option to arrange a ‘time to pay’ plan, reports the Daily Record.
Myrtle Lloyd, HMRC’s Director-General for Customer Services, commented: “I’m urging anyone who missed the deadline to submit their return as soon as possible to avoid any further penalties.”
Late return penalties include additional charges of 5% of the unpaid tax at 30 days, six months, and 12 months, along with accrued interest if taxes remain outstanding past the due date
Full penalties:
- an initial £100 fixed penalty, which applies even if there is no tax to pay, or if the tax due is paid on time
- after 3 months, additional daily penalties of £10 per day, up to a maximum of £900
- after 6 months, a further penalty of 5% of the tax due or £300, whichever is greater
- after 12 months, another 5% or £300 charge, whichever is greater
This year saw a slight decrease from the previous period, with 11,581,962 returns logged before last year’s deadline of January 31, 2024.
Charlene Young, Pensions and Savings Expert at AJ Bell, noted: “HMRC estimates that 1.1 million people failed to file by the deadline risking £100 late filing penalties, a potential windfall for the taxman of £110 million.”
She further stated: “After Barclays suffered a systems-wide outage on Friday January 31, some taxpayers who held on to their cash until the last minute or were waiting for payday could have found they were unable to send money.”
“HMRC is said to be working with Barclays and reassured those genuinely affected will be able to appeal any late payment fines through the usual channels.”
Who should file a Self Assessment?
Even if taxes are paid through PAYE, taxpayers may need to complete a tax return, for instance, if they:
- have to pay the High Income Child Benefit charge
- are a partner in a business partnership
- received interest from banks and building societies or investments (more than £10,000)
- are self-employed and earned up to £1,000 and wish to pay Class 2 NICs voluntarily to protect their entitlement to State Pension and certain benefits
- are self-employed and have earned gross income over £1,000
- had a total taxable income of more than £150,000
- have received any untaxed income including pension income over £2,500
- received income over £1,000 from trading or providing services online
- received rental or letting income from UK land and property
More information about selling online and paying taxes can be found on GOV.UK by searching ‘online platform income’ or by downloading the HMRC app. This guidance will assist in determining whether their activity should be considered as a trade and if a Self Assessment tax return needs to be completed.