Self-Assessment Tax Return Deadline is Coming – Tick Tock On The Compliance Clock

The festive season is on the horizon, and it might be fair to say completing your tax return may not be at top of the priority list, but it’s important to remember the online self-assessment filing deadline of 31 January…

Blog15th Dec 2023

By Tom Purves

The festive season is on the horizon, and it might be fair to say completing your tax return may not be at top of the priority list, but it’s important to remember the online self-assessment filing deadline of 31 January 2024, is just around the corner.

With less than seven weeks to go until the 31 January 2024, and the paper filing deadline already passed, it is vital to ensure you meet your reporting obligations to HM Revenue & Customs (HMRC) on time. If not, you could face late-filing and payment penalties and interest charges on any outstanding tax liability.

Do You Need To File?

You are required by HMRC to file a Self-Assessment Tax Return for 2022/23 if you meet any of the following criteria between the dates of 6 April 2022 and 5 April 2023:

  • You have a total taxable income exceeding £100,000.
  • You earned more than £1,000 in turnover from a self-employment.
  • You were a partner in a business partnership.
  • You are required to pay the High-Income Child Benefit Charge.

Additionally, you may also be required to file a Self-Assessment Tax Return in the year if you received income which has been untaxed. This could include income from property rental, savings or dividend income from banks and investment portfolios and income arising from overseas sources.

If you are unsure whether you may be required to file a Tax Return for 2022/23, then please visit our Contact page, enter your details and a member of the team will be in touch.

What If You File Late?

If your tax return is electronically filed after the 31 January 2024 deadline, you will face an immediate £100 fixed penalty, regardless of whether a tax liability is due. Further penalties will become payable once the filing deadline has been passed:

Time Overdue Penalty
Up to 3 months £10 per day, up to a maximum of £900 (90 days late)
Over 5 months 5% of the outstanding tax liability or £300 whichever is higher
Over 11 months 5% of the outstanding tax liability or £300 whichever is higher

Taxpayers should also note that HMRC will automatically apply interest to late tax payments. The interest rate on outstanding income tax and capital gains tax is currently 7.75%, reflecting a 1.75% increase from last year. This rate is far higher than interest paid on any tax refunds, which is some 3.5% less, i.e. a much reduced 4.25% repayment rate.

In addition to the penalty structure for late filing – further penalties become payable once 30 days have passed from the due date of payment where a tax liability remains outstanding:

Time Overdue Penalty
30 days 5% of your tax liability at this date
Over 5 months 5% of the outstanding tax liability at this date
Over 11 months 5% of the outstanding tax liability at this date

If an individual is struggling to make tax payments by the due dates, we would recommend contacting HMRC to establish whether it is possible to set up a time to pay arrangement. It is important to note, however, that participation in a time to pay arrangement does not exempt you from any interest charges on outstanding tax liability.

The Time to Pay arrangement can be set up with HMRC as long as you meet all of the following conditions:

  • You are up to date on your Self-Assessment Tax Return filing, and have filed your latest Tax Return.
  • You have a Tax Liability of £30,000 or less.
  • You are within 60 days of the payment deadline.
  • You do not have any other outstanding payment plans or debts to settle with HMRC.

In order to set up a payment plan with HMRC, they will ask you about your income and spending patterns.

We Can Help

If you need support or advice with completing your Tax Return or have any questions before the 31st January please do not hesitate to get in contact with Tom Purves, anyone on our Private Client team, or your usual AAB contact.

By Tom Purves

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