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File outstanding self assessment returns now to avoid further penalties

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Published: 10 Mar 2021 Update History

1.1 million taxpayers who had still not filed their 2019/20 tax return in early March have already incurred a £100 fine. Action is needed before 1 April to avoid a 5% late-payment penalty.

HMRC statistics indicate that approximately 1.1m taxpayers had still to file their self assessment tax return on 2 March 2021.

In addition to incurring a £100 late-filing penalty, which had been waived by HMRC until the end of February in acknowledgement of the coronavirus pandemic, the deadline for the 5% late-payment penalty is now approaching.

Taxpayers should now file their 2019/20 return by the end of March and either pay their tax or arrange for time to pay (TTP), to avoid a late-payment penalty which applies this year on 1 April.

Normally, late-payment penalties of 5% of tax due are applied 30 days after the filing date. In February, HMRC announced that for 2019/20 returns taxpayers that either pay the tax owed or set up a TTP arrangement by 1 April won’t be charged late payment penalties.

If taxpayers still haven’t filed online by 30 April, however, then they will start to incur further late-filing penalties at the rate of £10 per day.

Online time-to-pay portal

HMRC has an online TTP portal to allow taxpayers who owe £30,000 or less to set up an automatic TTP arrangement to clear the debt by January 2022. This enables taxpayers to speed up the process as they don’t need to contact HMRC to set up this plan.

Taxpayers can set up an online payment plan to spread the cost of their latest self assessment bill if:

  • they owe £30,000 or less;
  • they do not have any other payment plans or debts with HMRC;
  • their tax returns are up to date; and
  • it is less than 60 days after the payment deadline.

This online portal remains open until 1 April 2021.

Appeal for late filing

Taxpayers who missed the 28 February 2021 deadline facing a £100 late filing penalty can still appeal if they believe they have a reasonable excuse for late filing. Taxpayers must file a return before they can appeal the penalty and make their case.

Missed SEISS grants

As confirmed in the Budget, taxpayers who failed to file their 2019/20 tax return by 2 March 2021 will not be eligible to claim the fourth or fifth grants under the Self-employed Income Support Scheme.  

Further resouces

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