Tax return penalties eased
If you missed the self-assessment filing deadline on 31 January 2022, don’t panic - HMRC is being very understanding this year!
You will not be charged a late filing penalty if you can get your tax return submitted online by midnight on 28 February 2022. HMRC is allowing this extra time as it realises that many businesses are short-staffed due to COVID-19.
The balance of the 2020/21 income tax, the first payment on account for 2021/22 and any 2020/21 capital gains tax are all still due by 31 January. However, if your tax return was submitted late, you may not have the correct figures in time to pay the tax due.
HMRC is also being lenient about the tax payment deadline. It won’t charge the normal 5% late payment penalty if the tax is paid in full by 1 April 2022. If you don’t have the funds to pay all you owe, you will escape a late payment penalty if you set up a ‘time to pay’ arrangement (TPP) before April.
You can apply for a TTP online once your 2020/21 tax return is submitted. This arrangement will be approved automatically by HMRC if all the following apply:
- you owe less than £30,000;
- the application was made before 1 April 2022;
- you agree to pay all the tax owing within the next 12 months or less.
You need to set up a direct debit to pay the tax by instalments (we can’t do this for you) and should be prepared to pay the first instalment immediately.
If the amount due is more than £30,000 or you can’t pay it all within 12 months, you need to call the selfassessment payment helpline (0300 200 3822) and agree a bespoke TTP.
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| We can help you set up or negotiate a ‘time to pay’ arrangement. |