Figures published by HMRC have revealed that nearly one million taxpayers in the UK missed the deadline for filing their self-assessment tax return.
According to HMRC, 11.1 million people filed their tax returns on the January 31st deadline Paper forms had an earlier deadline of October 31st, but a record-breaking 10.4 million people filled in the forms electronically which had a later deadline of January 31st.
Last year, more than one million people missed the deadline. And fines can be issued immediately for late filing.
Andrew Diver, Beatons’ Head of Tax, said: “Many taxpayers struggle to understand the complexities of completing tax returns.
“It can be costly if they fail to complete their returns on time or file them incorrectly. Although record numbers of people are filing their self-assessment forms, overall knowledge of the tax system is declining. A YouGov survey quizzed 2,000 adults about their tax knowledge and gave them a score out of 30. The results revealed the average score was 10.6 and nearly half of the participants scored less than 10.”
If the tax bill for 2018/19 was not paid by February 28th, 2020, HMRC will impose a 5% late payment surcharge. HMRC send out tax payment statements in December. However, if the return was not submitted and processed by HMRC before December, they will not notify taxpayers of what is due.
Andrew added: “It is self-assessment; they expect you to know what to pay and when. The first some taxpayers are aware that they have missed a payment is when HMRC send them a notification that a 5% surcharge has been added to their account. The surcharge notices are due to be sent out around mid-March. Unfortunately, there is little mitigation to the late payment surcharge.”
The HMRC data showed that more than 700,000 people submitted their tax returns on deadline day – with a peak of nearly 57,000 submitted between 4pm and 5pm. A total of 26,562 people completed their tax returns in the final 60 minutes before deadline.
Angela McDonald, director general for customer services at HMRC, said: “Customers who have missed the deadline should contact HMRC. The department will treat those with genuine excuses leniently, as it focuses penalties on those who persistently fail to complete their tax returns and deliberate tax evaders. The excuse must be genuine and HMRC may ask for evidence.”
The current system means HMRC could charge a fine of £100 for late filing during the first three months after the deadline has passed. After three months, additional penalties of £10 per day can be demanded – up to a maximum of £900. This is followed by further fines six and 12 months after the deadline.
Beatons can help with preparing and filing self-assessment tax returns. Get in touch by emailing info@beatons.co.uk or by calling the office on 01473 659777.