The deadline for submitting your self-assessment tax return is approaching, and missing it could result in a £100 fine from HMRC. The cutoff for the 2024/25 tax year is midnight on January 31, with HMRC indicating that 3.3 million individuals still need to file as of January 23.
Various circumstances necessitate filing a self-assessment tax return, such as being self-employed, earning additional income apart from your primary job, deriving income from property rentals, or being a high earner claiming Child Benefit. Failure to meet the deadline will incur a £100 penalty from HMRC, irrespective of whether there is any tax liability.
The penalty escalates if the tax return remains outstanding, with daily fines of £10 up to a maximum of £900 after three months. After six months, a charge of 5% of the tax owed or £300, whichever is higher, applies, and this pattern repeats every 12 months.
To avoid accruing interest on late tax payments, it is essential to settle any tax due by January 31. If you owe less than £30,000, setting up a Time to Pay arrangement with HMRC may be an option. This requires having no existing payment plans or debts with HMRC, up-to-date tax returns, and requesting assistance within 60 days of the payment deadline.
Registration for self-assessment should have been completed by October 5 of the previous year. According to MoneyHelper.org.uk, filing a self-assessment tax return may be necessary under specific circumstances. You can verify your obligation to submit a tax return by checking the HMRC website online.
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