As we approach Christmas and the New Year, a quick reminder of one Xmas present that you will want to avoid.
Electronic Self Assessment Tax Returns need to be submitted to HM Revenue & Customs on or before 31st January 2014. This means that they must be submitted by midnight on that Friday. This applies to returns that are submitted electronically, as are all returns for our clients. You should be aware that in order to file a return electronically you will need a Government On-Line account, and these can take several weeks to set up. To do so you should go to https://www.gov.uk/how-to-send-self-assessment-online/sign-up-for-an-online-account.
The deadline for submission of paper returns is 31st October 2014! The tax office considers that any return delivered by hand and found in the post box before 7.30am on 1st November will be deemed to have been received before midnight. However, most tax offices no longer have post boxes! Also it should be noted that it is the date of receipt by the tax office and not the date of posting that is relevant. Therefore, any returns posted within a week of the deadline should certainly be sent 1st class, and it would be wise to send them “special delivery”.
If a return is not submitted by the due date then penalties become payable as follows:
- 1 day late: £100
- 3 months late: £10 per day up to a maximum of £900
- 6 months late: £300 or 5% of the tax payable
- 12 months late: £300 or 5% of the tax payable
Therefore, a paper return not submitted until 31st January 2014 will incur a penalty of £100. If that same return is not submitted until 30th April then the penalty will be £1,000. However, if the return was submitted electronically then that penalty would be £100.
In addition to the above there are also penalties, as well as interest, if you do not pay your tax on time but perhaps we should leave those for another day!