Whilst over ten million Self Assessment tax returns were completed before the 31st of January deadline, HM Revenue and Customs (HMRC) has stated an estimated 710,000 returns are still outstanding – leading to automatic fines.
Table of contents
Self Assessment involves completing a tax return each year. It is primarily used by self-employed UK nationals who have over one source of income.
Of those who had not completed their tax returns, HMRC has stated that just under 100,000 were parents where one parent earned taxable income totalling over GBP 50,000 – a new section of the public to file tax returns after the recent changes in the child benefit system.
Those who can offer a reasonable excuse for their late tax return – such as problems caused by the recent spate of floods – may become exempt from the fine.
Penalties
Penalties start at GBP 100 and will occur by the end of this month.
However, they can accumulate to fines worth hundreds of pounds if forms are not submitted and taxes are left unpaid.
If a reasonable excuse is not offered and accepted, after three months from the date of the deadline additional daily penalties of GBP 10 per day can apply up to a total of GBP 900.
After half a year, a further penalty of 5% of the total tax due applies or GBP 300 (whichever is higher) and after a year, there is a further 5% or GBP 300 charge.
Deadlines
Whilst paper returns face a 31st of October deadline, the online deadline for returns was the 31st of January – which was the most hectic day for online returns with 569,847 received by HMRC.
On that day, the hour between 4pm and 5pm was the busiest, when a total of 45,706 returns were completed.
Around 21,027 individuals left it until the final hour of the final day to complete their forms.
Copycat site
Taxpayers have been warned about taxreturngateway.com, a copycat site which mimics the colour scheme and look of the HMRC tax returns website – and pay fees to Google to rank highly in the search engine’s results in order to lure visitors into paying high service charges to complete their tax return.
Many readers of The Mail of Sunday revealed they felt they had been duped, having believed they were filling out the appropriate HMRC tax return.
Operated by Sunderland-based Who4, the site charges fees of up to GBP 1,000 by calculating a person’s tax fee, before immediately asking the customer to pay a payment “you must now make” – which is the exact same fee as the estimated tax return.
The website also warns that if payment is not made, “your tax return will not be submitted and you may be liable to penalty or prosecution’ by Revenue & Customs.”
However, the fee is a Who4 service charge, and is not part of the HMRC tax charge.
Whilst many customers are complaining, as yet no legal action has been taken. On the taxreturngateway.com, the site states it is not affiliated with HMRC, although this does little to pacify those who feel conned.
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