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Self-assessment reminder – avoid the penalty

The last thing people want to be thinking about in the run up to Christmas is anything tax related, but for many people the process of self-assessment is looming.

Chancellor George Osborne announced in this year’s Autumn Statement that £800 million would be spent on tackling tax evasion and non-compliance through to 2020.

Failing to submit your self-assessment tax return on time will result in a penalty fine of £100. In this post, we quickly run through the processes to submit your online tax return on time and to avoid any tax related penalties that could affect you and your business in the long-term.

Overview

Whether you’re self-employed or run a business, the deadline for submitting your online tax return is on 31 January; this includes any tax bill payments you owe for the previous tax year.

The deadline for second payment on account is on 31July.

All payments are made to HMRC and must be completed by the deadline. Failing to do will result in charged interest and a penalty fine of £100 if the return is 3 months late.

Submitting your return

If you have a registered account, you can submit your tax return using HMRC’s free self-assessment online service.

There is software available to purchase that will send your self-assessment tax return, partnership tax return and trust and estate tax return.

Ways to pay

There are several ways to make your payment to HMRC on deadline day. The most common method is making a bank transfer from your account by Faster Payments, CHAPS or Bacs.

When making your payment, you will need to use your 11-character payment reference. This will be your 10-digit unique taxpayer reference UTR which you can access through your online account.

Faster payments are completed on the same or next day, including weekends and bank holidays.

CHAPS payments reach HMRC the same working day, if payments are made within your bank’s processing times. Bacs payments are completed within 3 working days.

Missing the deadline

Failing to pay your bills on time will lead to charged interest and enforcement action fees.

Flat fee rates are charged based on the level of action taken by HMRC. Issuing a notice will cost you £75, while taking control of your goods will charge you £235 plus 7.5% proportion of your main debt that’s over £1,500.

Goods taken and sold off will cost you £110, plus 7.5% proportion of your debt over £1,500.

How we can help

Our team can help you save time and money by handling your self-assessment for you. We will do all the necessary computations, complete your tax return and offer advice on how you can minimise your tax liability.

 

Speak to an adviser today to find out how we can help you with your self-assessment tax return.