Are you going to be late with your self assessment tax return? You’re definitely not the only one

HMRC are expecting 12.2million self assessment tax returns at the end of the month. According to HMRC, on 24^th January, four million of these taxpayers were yet to file.

When is the self assessment tax return deadline?

The filing deadline for your 2020-21 self assessment tax return is 11.59pm on 31^st January 2022. The payment of your corresponding tax bill is due at the same time.

But you don’t have to wait until this deadline to submit your tax return, or pay your bill. You can complete and file your tax return from the day after the tax year ends. So, you can send your 2021-22 self assessment tax return any time from 6^th April 2022. And lots of people do.

But the psychology of deadlines doesn’t work in everyone’s favour, there are always lots of last-minuters – and those that miss the deadline entirely.

Since the pandemic started, systems everywhere have been slower and more difficult to navigate. And filing your tax return is no exception. From getting an appointment with your tax professional, to getting through to HMRC advisors – people just need a bit more time. Especially when it comes to paying a tax bill just as your business is starting to recover.

HMRC knows this and has put some provisions in place to help taxpayers.

HMRC help

HMRC’s Director General for Customer Services, Myrtle Lloyd, said: “We know some customers may struggle to meet the Self Assessment deadline on 31 January which is why we have waived penalties for one month, giving them extra time to meet their obligations.

“And if anyone is worried about paying their tax bill, they can set up a monthly payment plan online – search ‘pay my Self Assessment’ on GOV.UK.

But what does this mean, in practice?

Usually, as soon as you miss either the self assessment tax return submission deadline, or the self assessment tax bill payment deadline, you start accumulating fines from HMRC. These start as soon as the clock strikes midnight on 31^st January.

But this year HMRC are waiving these normal penalties for one month. This means that as long as you get your tax return to HMRC by 28^th February, you won’t get a late filing penalty. And if you pay your whole bill, or set up a Time to Pay arrangement, by 1^st April you won’t get any late payment fines.

This is likely to be a huge relief to many business owners who’re struggling with both of these requirements. But you do need to be aware that you’ll still have to pay 2.75% interest on any payment made after 31^st January. It’s just the late payment penalties that are being waived.

After both of these dates, the regular penalties will apply.