From 6th April 2011, new penalties will be applied to anyone who files their self-assessment tax return late. If you miss the filing deadline, you will automatically receive a fixed £100 penalty. For each further day that your tax return is outstanding, you will be charged an extra £10 per day. This will occur for up to three months. After the initial three months, resulting in your penalties totalling £900, you will then be charged the larger amount of £300 or five percent of the tax chargeable. Any tax which is owed and still outstanding at 31st January will incur a further penalty of five percent of the amount owed. A further five percent will be added every 30 days.
Stephen Banyard, acting director of personal tax said:
“The old £100 penalty was not much of a deterrent and these new penalties, which increase over time, will get people to submit returns as soon as possible. Basically the greater the delay, the greater the penalty.”
As approximately one million tax returns are submitted late, HM Revenue & Customs are hoping that the new penalties will encourage everyone, businesses and individuals to file their returns on time. An online accountants can complete and file your self assessment tax return online before the deadline of 31st January, ensuring you don’t pay more than you need to. Paper tax returns have to be filed before the earlier date of 31st October, which is why a low cost accountant is necessary. Filing all documents in a timely manner can prevent you receiving a huge, unexpected bill.
Want to learn more?
Subscribe to our newsletter to get accounting tips like this right to your inbox