Self Assessment Late Penalties Relaxed Due To Pandemic

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June 30th 2022
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Self Assessment Late Penalties Relaxed Due To Pandemic

Temporary easing of penalty dates comes as near half of tax returns remain outstanding.

The January 31st deadline to file a self assessment tax return online is fast approaching but out of 12.2 million tax returns required, near 5.7 million remain outstanding or incomplete - last year 15 percent of tax returns missed the deadline.

In normal times there is a late payment penalty of 5 percent of the outstanding tax bill that applies from February 1st - but this year it will be relaxed to only apply from April 1st - whether paid in full or by setting up a payment plan by that date.

The late filing penalty of an automatic £100 fine will also be relaxed to apply from March 1st if the tax return remains outstanding - and penalties continue to be applied on the third, sixth and twelfth months.

People are still encouraged to get tax returns filed by the 31st January as HMRC will still be charging interest on unpaid tax from February 1st. The rate of interest is 2.75 percent.

The relaxation of the rules comes as HMRC admits people are facing ongoing pressures due to the effects of the pandemic. The combined issues of self isolation and people getting sick has made accountants struggle to meet deadlines.

Additionally, HMRC is reminding people that the Time to Pay payment arrangement can be set up online for bills of up to £30,000, a facility already being used by over 30,000 taxpayers in the last year.

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