HMRC not quite so taxing on late tax return penalties

1 February 2022

Businesses and individuals who are not already among the more than 10.2 million customers who have filed their 2020/21 tax returns by the 31 January deadline, have a little more time to do so – but not that much as HMRC says this leeway only lasts until 28 February.

HM Revenue and Customs (HMRC) has revealed that more than 630,000 customers filed on deadline day and the peak hour for filing was 16:00 to 16:59 when 52,475 completed their Self Assessment. There were 20,947 customers who completed their tax return between 23:00 and 23:59.

More than 12.2 million customers were expected to file a Self Assessment tax return this year. The remaining 2.3 million customers expected to file by 31 January now have until 28 February to submit their late 2020/21 tax return and avoid a late filing penalty.

For any Self Assessment customers who are yet to pay their tax bill or set up a payment plan, interest will be applied to outstanding balances from 1 February. Customers have until 1 April to pay their tax in full, or set up a time to pay arrangement, to avoid a late payment penalty.

Those who are not yet able to file their tax return should pay an estimated amount as soon as possible, which will minimise any interest. Self-employed people can use the calculator on GOV.UK to help estimate their tax bill.

Covid relief payments
The 2020/21 tax return covers earnings and payments during the pandemic. Taxpayers will need to declare if they received any grants or payments from the COVID-19 support schemes up to 5 April 2021 on their Self Assessment, as these are taxable, including:

  • Self-Employment Income Support Scheme
  • Coronavirus Job Retention Scheme
  • other COVID-19 grants and support payments such as self-isolation payments, local authority grants

Myrtle Lloyd, HMRC’s Director General for Customer Services, said:

“I’d like to thank the millions of customers and agents who sent us their tax return and paid in time for this week’s deadline.

“We’re waiving penalties this year, to give those who missed the deadline an extra month. And customers can set up a monthly payment plan online if they’re worried about paying their tax bill. Search ‘Self Assessment’ on GOV.UK to find out more.”

The existing Time to Pay service allows customers, who are unable to pay their bill in full, to spread their tax payments into manageable monthly instalments. Self Assessment customers with up to £30,000 of tax debt can do this online once they have filed their return.?? ?

If customers owe more than £30,000, or need longer to pay, they should call the Self Assessment Payment Helpline on 0300 200 3822.

A full list of the payment methods customers can use to pay their Self Assessment tax bill is available on GOV.UK.


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