Millions of taxpayers could face a costly bill from HMRC if they don’t file their taxes this week, say leading audit, tax and business advisory firm, Blick Rothenberg.
Robert Salter, a Director at the firm, said, “According to HMRC, at least 3 million taxpayers still need to file their Self-Assessment Tax Return before the 31st January deadline. The late submission of a return when HMRC have issued someone with a clear ‘notice to file’ automatically results in a taxpayer facing a £100 late filing penalty.
“This is the case even where someone can subsequently show that no tax was due or even a tax refund was due. Which is a concern for people that have received a ‘notice to file’ from HMRC incorrectly, as they no longer have trading or letting income and are having all of their income automatically accounted for via PAYE.
“But while HMRC will cancel a tax return filing obligations when there should be no additional income tax due, it can be very difficult to speak with a HMRC official this close to the 31st January deadline.”
He added, “For many taxpayers it will be easier to file a return in the next few days, even if there are no income or capital gains to report. As the timely submission of a tax return ensures that no late filing penalty will be charged by the Revenue.
“However, it is not only the tax return itself which needs to be submitted by the 31st January filing deadline. Any income tax, capital gains tax and class 4 National Insurance Contributions (NICs) which are owed must be paid.
“If the taxes due aren’t settled by the 31st January deadline, HMRC will impose late payment interest, at a relatively punitive rate of 7.75%. If taxpayers still have taxes underpaid at the end of February, the Revenue will automatically add a 5% surcharge on the amount that they need to settle.”
