File tax returns now to prevent penalties

Self Assessment taxpayers have less than a week to submit their late tax returns to prevent a £100 penalty, after the usual 31 January deadline was extended by a month to help anyone who may be struggling because of the coronavirus pandemic.

While 10.7 million taxpayers filed their return by 31 January, HMRC says more than 1.5 million taxpayers missed this deadline and are still to file their tax return. They are accruing interest on any unpaid tax liabilities but still have time to file and pay without incurring penalty charges.

Taxpayers have until 28 February to file their return and prevent a late filing penalty of £100.

Those who owe tax have until midnight on 1 April to pay any outstanding tax or set up a payment plan to prevent a 5% late payment penalty. 

The usual payment deadline for Self Assessment is 31 January and interest is charged from 1 February on any amounts outstanding. Usually, a 5% late payment penalty is also charged on any unpaid tax that is still outstanding on 3 March. But this year, because of the impact of the Covid-19 pandemic, HMRC has given taxpayers more time to pay or set up a payment plan. 

Taxpayers can pay their tax bill or set up a monthly payment plan online at GOV.UK. They need to do this by midnight on 1 April to prevent being charged a late payment penalty.

The online Time to Pay facility allows taxpayers to spread the cost of their Self Assessment tax bill into monthly instalments until January 2022.

Jim Harra, HMRC’s Chief Executive said: “Self Assessment taxpayers have until 28 February to file their tax returns and prevent being charged a £100 late filing penalty.

“I’m urging anyone who is still to complete their return to not put if off any longer risking penalties and further interest on their outstanding liabilities. Support is available on GOV.UK for anyone worried about how to complete their tax return or how to pay their tax bill.”

He added: “Anyone worried about paying their tax can set up a payment plan to spread the cost into monthly instalments. Support is available at GOV.UK to help anyone struggling to meet their obligations.”

Anyone who is worried about paying their tax can set up a payment plan online or contact HMRC for more help and support on 0300 200 3822.

There are several ways that taxpayers can pay their Self Assessment tax bill in full. They can pay online, via their bank, or by post. More information on how to pay is at GOV.UK. Taxpayers should still pay in full if they can. This is the only way to stop interest accruing.

Self Assessment taxpayers who are required to make payments on account, and know their 2020 to 2021 tax bill is going to be lower than in 2019 to 2020 – for example due to loss of earnings because of Covid-19 – can reduce their payments on account. Visit GOV.UK to find out more about Payments on Account and how to reduce them.

Be aware of copycat HMRC websites and phishing scams. Taxpayers should search ‘self assessment’ on GOV.UK to get the correct link to file their Self Assessment tax return online securely and free of charge.

They also need to be alert if someone calls, emails or texts claiming to be from HMRC, saying that they can claim financial help, are due a tax refund or owe tax. It might be a scam. Check GOV.UK for information on how to recognise genuine HMRC contact.