With the festive season on the horizon it’s easy to push the tax return deadline to the back of your mind, however don’t wait to start your return until the New Year.
There are only 76 days until the self-assessment tax return deadline of 31 January 2019. If your return is not filed by this date you will receive an automatic penalty of £100 from HMRC. Almost half of all tax returns were filed in January last year and over 750,000 were filed on the deadline day.
Should I complete a self-assessment tax return?
The self-assessment tax return is an annual requirement for people who do not pay their tax automatically through PAYE. If you are self-employed, you'll need to let HMRC know about your annual earnings, so that you pay the appropriate amount of tax.
Self-Assessment applies to:
• Self-employed people including business partners
• Company Directors
• Individuals with more complicated tax affairs including those who pay higher rate tax
• Pensioners with more complex tax affairs
• People who receive rent or other income from land and property in the UK
• Trustees and personal representatives
• Trustees of approved self-administered pension schemes
• Non-resident company landlords
HMRC fines
HMRC will issue an immediate £100 fine if you submit your tax return late. Further charges apply depending on how long the return is filed after the deadline.
| Late filing | Penalty |
| Miss filing deadline | £100 |
| 30 days late | 5% of tax due |
| 3 months late | Daily penalty £10 per day for up to 90 days (max £900) |
| 6 months late | 5% of tax due or £300, if greater* |
| 12 months late | 5% or £300 if greater* |
There are also fines in place for sending an incorrect tax return or if it contains mistakes and penalties are high for those who attempt to conceal their income in order to pay less tax.
Top mistakes tax payers make when completing their tax returns
Making mistakes on self-assessment tax returns however innocent can lead to enquiries, investigations and additional tax, interest and penalties.
Below are some of the top mistakes many people make:
• Forgetting to include income from a previous employment that ended part way through a tax year.
• Forgetting to include benefits from a previous employment that ended part way through a tax year.
• Forgetting to include student loans when your earnings exceed the threshold
• Forgetting Child benefit clawback for earners who are receiving child benefit and who earn more than £50,000
• Ignoring tax codes and forgetting tax underpayments from previous years collected through their tax code
• Claiming for expenses that cannot be claimed for
Act Now!
Begin the process early to give you all the time you need and avoid starting 2019 rushing to file your tax return or worst of all with a £100 fine! The best way to ensure that your tax return is completed correctly is to speak to a tax expert who can ensure everything is accurate and submitted in a timely manner.