HMRC warning: Self Assessment deadline just one week away – Britons urged to act fast | Personal Finance | Finance
HMRC, or HM Revenue and Customs, is responsible for collecting Income Tax, among other responsibilities, and one of the ways it does so is through a Self Assessment tax return. Eligible Britons were required to submit their tax return by the January 31, 2021 deadline, however, the Revenue did provide some reprieve at the time due to COVID-19. It stated late filing penalties would be waived if a person struggled to meet the January deadline this time around.
However, while this did provide a certain level of relief, a new deadline is just around the corner – and Britons will need to act fast.
In order to avoid a late filing penalty, HMRC has said people must file online by February 28, which is now just a week away.
From February 1, interest has been charged on any outstanding liabilities a person may have.
However, a failure to file by February 28 will mean Britons have to deal with more charges they may have otherwise avoided.
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People who are unable to pay a tax bill on time are able to apply to spread their bill over up to a 12 month period.
However, these individuals will be required to file their 2019/21 tax return before setting up this so-called “Time to Pay” arrangement.
Mr Parkes, though, provided further insight into the implications of late filing penalties on a person’s finances.
He added: “Failure to meet the extended deadline will only result in further financial pressure after a tough year of trading.
“Based on a £4,000 tax bill, that liability will rise by a further £308 within days of the deadline passing if someone fails to file their tax return and pay their tax bill.
“This includes £300 in penalties and interest accrued since the January 31 deadline at a rate of 2.8 percent.
“With people already struggling financially, this would be between an 11 percent to 15 percent increase on the average living expense for a family of four per month.”
People are therefore being urged to take action this week to ensure they do not fall foul of HMRC’s penalties.
Mr Parkes concluded by encouraging Britons not to “bury their head in the sand” and instead act as soon as possible.
Leaving ample time to complete a Self Assessment tax return means individuals are less likely to make mistakes.
For those who are unsure about the process, seeking advice or using tax software will simplify the process.
People will be able to pay their tax bill online, through their bank, or by post and if they are uncertain, guidance is available on the Government’s website.