Knowledge

What Happens if I’m Late Doing My Tax Return? An RJF Accounting Guide

Self Assessment: What Happens if I Miss the Deadline?

Being late with your tax return to HMRC is a pretty big deal. Yet, official figures show that up to 1 million of us fail to file it on time and receive a penalty every year. The annual deadline for completing your self-assessment tax return is January 31st every year (earlier if you do it via paper return). Still, it can be completed any time from the end of the tax year on April 5th, giving you ample time to prepare and file it.

 

How Much Is the Fine if I Miss the Self Assessment Filing Deadline?

If you fail to submit your tax return on time and pay any taxes due, you will get an automatic £100 penalty. This will be added to your online tax account with HMRC on the Government Gateway. This penalty is payable even if you did not owe any tax, and also, in cases where you failed to inform HMRC that you no longer need to submit a tax return and failed to inform them, the fine will still be applied.

The penalties do not stop there. There are also fines and interest due in addition to the £100 penalty. This can, in some circumstances, double your liability. For example:

If you were late filing your April 6th 2019 to April 5th 2020 tax return and did not complete this till August 31st 2021 and paid the tax due on the same day, your tax bill was £1000. The total, including fines and interest owed, would be £2,415.

Broken down as follows:

  • Your penalty for sending the return late: £1,300
  • Tax bill owed: £1,000
  • Interest added for paying your bill late: £15.10
  • Penalty for paying your bill late: £100

So your tax bill of £1000 more than doubles to £2,415 as you failed to file it and pay any tax due on time.

*Figures collated using the HMRC online calculator.

 

Can You Appeal an HMRC Penalty? 

The simple answer is yes, you can appeal an HMRC penalty, but only if they agree that the circumstances warrant it. HMRC says it will waive the late-filing penalty for people who have a “reasonable excuse”. However, this will be done at the officials’ discretion.

If you do wish to appeal against a penalty, you’ll need to fill out the SA370 form, or you can appeal online.

 

How to Avoid HMRC Penalties & Late Returns 

The simplest way to avoid any late payment penalties and interest is to ensure that your tax return is completed on time. It’s a well known saying that hiring an accountant can save you more than they cost in fees. Using the calculations above, this should be apparent, showing how just missing your deadline date by a few months could more than double your liability for one year.

Further reading to help you with your Self Assessment Tax Return: