Tax return deadline – don’t be late!
The self-assessment tax return deadline is midnight on 31 January 2014 for the 2012/13 tax year. If you haven’t already done your return you need to do it as soon as possible. The paper deadline has now passed (October 2013) so you need to do the return online.
What are the fines if my return is late?
The later the return is, the more in penalties you will have to pay. If you are between 1 day and 3 months late you will pay a penalty of £100. This stands even if you have no tax to pay.
If the return is between 3 and 6 months late you will get charged an additional £10 a day up to a maximum of £900. This is in addition to the £100 above.
If the return is over 6 months late you will be charged an additional £100 or 5% of the tax due (whichever is higher) and this is in addition to the amounts payable above.
If the return is over 12 months and the case is deemed serious, then you could have to pay up to 100% of the tax due as a penalty in addition to the penalties above.
Interest and penalties if you don’t pay your tax on time
You will be charged interest on anything you owe and haven’t paid (including penalties) until you pay. Interest is 3% on late payments.
If you don’t pay your tax within 30 days you will start to receive penalties. These penalties are cumulative and start at 5% of the tax you owe at 30 days to another 5% of the amount due after 6 months and another 5% of anything left after 12 months.
Don’t pay more tax than you need to: get your return in early for 2013/14
If you are caught by the self-assessment process and you have more than £1,000 to pay, you will need to pay your tax for 2012/13 plus a “payment on account” for 2013/14 which will be around half as much again. There will be a further payment in July for the other half. As HMRC don’t know how much you will earn next year they estimate it is the same as the current year. Should you have lower income in 2013/14 than in 2012/13 you can reduce your payment on account by doing your 2013/14 return before the end of July. Why pay more than you need?
When submitting your 2012/13 return via an agent, your payments on account can be reduced on the basis you know your income will be lower. Be warned though, if you end up earning more than you expect you will have interest to pay.