As the 31 January Self-Assessment deadline approaches, 3.8 million individuals are yet to file their tax returns, facing a potential £100 penalty. HM Revenue and Customs (HMRC) urges prompt action to avoid penalties and provides insights into meeting the deadline, payment options, and ceasing Self-Assessment.
Meeting the Self-Assessment Deadline
With only one week remaining, HMRC expects over 12.1 million tax returns for the 2022-2023 tax year. Over 8.3 million online returns have been received, emphasising the need for timely submission.
Penalties for missing the self-assessment deadline include the following:
- Initial £100 fixed penalty, applicable even if no tax is due or if tax is paid on time.
- After three months, additional daily penalties of £10 per day, up to a maximum of £900.
- After six 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.
To avoid having to pay any of these hefty fines, it is advised to file your tax returns before the Self-Assessment deadline as soon as possible.
Payment Options and Ceasing Self-Assessment
Setting up a Time to Pay arrangement for amounts under £30,000 is encouraged for those unable to pay in full. HMRC advises seeking online help before contacting them directly. Additional penalties exist for missing the self-assessment deadline, including 5% of the unpaid tax at 30 days, six months, and 12 months.
Interest is also charged on late payments. Individuals considering ceasing Self-Assessment for the 2022-2023 tax year are reminded to inform HMRC before the deadline to avoid penalties. HMRC has produced videos guiding self-employed and non-self-employed individuals on how to cease Self Assessment online.
