HMRC rejects calls to delay self-assessment deadline

HMRC reject calls to extend self-assessment deadline

Easing the looming self-assessment tax return deadline would “complicate” things, say HMRC

Accounting industry groups wrote a joint letter to HMRC urging the tax office to relax the deadline for people to file their upcoming self-assessment returns, arguing that the economic hardship caused by the Coronavirus pandemic will make it difficult for people to submit and pay their tax on time.

The letter, sent by the Association of Accounting Technicians (AAT), the Institute of Chartered Accountants in England and Wales (ICAEW), the Chartered Institution of Taxation (CIOT), the Institute of Chartered Accountants of Scotland (ICAS) and the Association of Chartered Certified Accountants (ACCA), also called for the late penalty fee to be waived for a short period.

However, HMRC’s Chief Executive Jim Harra responded to the letter and rejected the group’s calls for easing the deadline and waiving the late filing fees, saying it would “complicate” things.

HMRC will accept ‘pandemic-related’ reason

In his letter, seen by Contractor Weekly, Harra said HMRC want to “encourage” people to complete their tax returns by 31 January 2021, “even if they can’t pay in full”, and “do not want to complicate this message by sending a blanket signal that it’s okay to file late.”

He explained: “That could have some serious disadvantages for our customers; de-coupling the payment and filing dates might confuse customers, and even lead to non-payment, interest accruing, and late payment penalties being triggered.”

Around one million self-employed people missed the 31 January deadline in 2020, according to a survey by TaxScouts. This year, the cost of deferring taxes could spiral as nearly a third (27%) said the pandemic had made them more likely to delay filing their returns.

HMRC have acknowledged that COVID-19 will have had an impact on some accountants and their clients when it comes to doing their self-assessment. 

Late penalty appeal period extended

Therefore, Harra said they “will not penalise people who need more time” and will “accept a pandemic-related personal or business disruption as a reasonable excuse.”

“If their return is late due to pandemic-related delay on the part of an agent, this will also be a valid reasonable excuse,” he added.

The taxman will also extend the penalty appeal period to three months for anyone who receives a penalty notice.

Harra concluded his letter by saying: “I know you will be disappointed that our decision is not what you and many of your members wanted. 

“I understand and sympathise with the extreme pressures your members have been under in this exceptional year: they have helped deliver the economic response to the pandemic, helping UK businesses get the support they need while at the same time suffering the effects of the pandemic on their own firms. I am very grateful to them for their valuable and vital work.”

Richard Wild, head of tax technical at the CIOT, said in response: “We are disappointed that HMRC did not waive the late filing penalties until 1 March like we called for. However, we understand why that is – filing rates are currently holding up and they would need a real business case to justify such changes which currently isn’t apparent.

“We will continue to be in discussions with them on this matter in January as we know that many taxpayers and their advisers have been significantly impacted by the pandemic.”

If you can’t pay your self-assessment tax return on time, please visit the government website for more information.


  • BorisJ says:

    HMRC have helped to destroy the IT freelance market

    Brexit helps to destroy financial services market

    Thanks HMRC another thing well done

    • Gary Andrews says:

      I couldn’t agree more. This government is intent on stamping out the freelance market for reasons it’s not being honest about.

  • Ying Tong says:

    Relevant to the points made in the article, what is the argument for late filing of the self assessment return? (The payment of tax due is obviously a different question.)
    If my case is anything to go by, traditionally I would use the Christmas holidays to bring together and review a statement of income from all sources to pass to my accountant in early January for filing and payment by 31 Jan. This year with much more time on my hands I had it all done and dusted before December even. Would that not be the case for most contractors affected by Covid restrictions?

    • Gary Andrews says:

      True in many cases people have had ample time on their hands to deal with a simple self-assessment. Those with few sources of income should be able to wrap it up in an hour or two, pay their low overall tax obligation and get back to berating the tax cheats.
      Those with healthy final salary pensions are best catered for in this respect.

      If running businesses with many complex sources of income then it’s not so easy when facing up to runaway debt. This year’s seen many entrepreneurs on the brink both financially and mentally. One self-employed associate has taken to heavy drinking while refusing to open any mail. I’m sure he’s not alone and heavy handed actions by HMRC intensify such mental illness. Their Behavioural Insights teams’ psyops bullying takes its toll before handing them over to private debt collection and washing their hands.
      Late filing in these conditions might mean someone’s drowning, lets not throw them an anvil.

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