More than half a million workers expected to file tax returns after the deadline
As many as 600,000 self-employed workers expect to miss the self assessment deadline (31st January), according to research from Handelsbanken Wealth & Asset Management.
The news paints a worrying picture and cites HMRC data from 24th January that claimed 3.4m tax returns were still outstanding. HMRC expects to receive 12m self assessment tax returns this year, compared to 10.8m the previous year.
The survey explored self-employment in the UK, citing the cost of living crisis as a key driver of people working this way – whether full or part-time. However, self-employed workers have also been grappling with the complexities of the self assessment process, too.
Mark Collins, Head of Tax at Handelsbanken, said the findings of the survey demonstrated that the self assessment process is “a little more complicated when people have a range of income streams from different sources.”
“There is plenty of help available from HMRC”, he continued, with the caveat that “there is the possibility of a £100 fine for being late.”
Collins also said that the results highlight “the importance of seeking advice, being organised and keeping a close eye on your tax records” over the course of the tax year.
HMRC accused of poor service
Despite high numbers of tax returns being filed over the Christmas period, HMRC has come under fire from ministers and customers for poor customer service levels, including excessive phone waiting times.
Long wait times have been blamed on the remote working policy that’s been introduced at HMRC offices, which sees staff able to work from home up to two days a week.
In the lead-up to the busiest time of the year for the tax office, the Telegraph reported that MPs and taxpayers had expressed concerns about wait times due to low levels of office occupancy; as low as 9% and no higher than 61% – the second-lowest figures reported by any central government office.
And with HMRC phone lines only open until 6pm on 31st January, some customers are concerned about being able to contact the office with queries.
The cost of late submissions and payment
Failing to file the self assessment tax return or pay your tax bill on time can mean significant financial penalties.
Late submissions attract a £100 fine immediately, and HMRC charges an additional £10 each day that the submission is late, up to a maximum of three months – a total fine of £1000.
Any inaccuracies will also be penalised; according to official figures released after a Freedom of Information (FOI) request, HMRC issued over 100,000 fines in the 2021/22 tax year for inaccurate tax returns.
While missing the deadline can be costly, it’s important to get the self assessment completed as soon as possible after the deadline if you do miss it, to minimise the overall fine.
HMRC may offer a payment plan for those who miss the deadline, but there are conditions around this, too.
You can have a trusted accountant organise your self-assessment tax return from as little as £99 + VAT. For more information, please click here.