You still needed to send HMRC your 2020/21 Self Assessment tax return and pay any tax owed by 31 January, but due to coronavirus, they announced they will waive late filing/payment penalties for tax returns submitted before midnight on 28 February if you can’t.
Tax returns treated as being received late have the following downsides:
- Although there will be no penalties, interest will be payable from 1 February on any unpaid tax, so it’s better to pay on time if possible.
- You’re extending the enquiry window, potentially giving HMRC extra time to open an enquiry into your tax return.
- Benefit entitlement may be affected if you’re a Self-employed taxpayer paying Class 2 NIC’s who needs to claim certain contributory benefits if you’ve not paid your Balancing Payment by 31 January.
So, the deadline has been and gone – you have not yet completed your tax return, let alone paid it. GoSimpleTax suggests you complete your self-assessment to know your tax liability and at least pay what you owe as soon as you can. You do not have to submit it, however, if you have done it why wait?
I have filed, but I am struggling to pay
If you cannot pay as your income has been affected by coronavirus you may be able to pay your self-assessment tax bill via a payment plan. HMRC have an online application for Time to Pay.
You can spread the cost of your latest self-assessment bill if
- You owe £30,000 or less
- You do not have to pay other payment plans or debts with HMRC
- Your tax returns are up to date
- It is less than 60 days after the payment deadline
You can see if you are eligible and apply for a payment plan online, you do not need to phone HMRC.
If you cannot access the online service or are not eligible you should call HMRC at your earliest convenience to discuss your situation. The self-assessment payment helpline is 0300 200 3822.
Think ahead for Making Tax Digital for Income Tax
With MTD for income tax over the horizon, it is mandated for 2024, begin converting to digital software. HMRC’s portal can be confusing – now is the perfect time to switch.
Digital software allows you to calculate your tax liability in real time if you chose to use it from April 2022 and update your finances weekly, monthly or quarterly. You can be one step ahead, plan your finances and spend more time concentrating on your business.
GoSimpleTax suggests submitting your 21/22 tax return on 6th April and then utilising software to stay up to date with your finances. Updating your tax return in real-time. You will always be one step ahead and with the uncertainty of the pandemic, it pays to be, as you are likely to be ready to claim any future help the government may offer.
To conclude, if you are yet to file or pay your 20/21 tax return, we advise you take action soon, whether that is to file and pay or to seek help from HMRC through the Time to Pay. Delaying is just putting off the inevitable – seek help if you need it.
Income, Expenses and tax submission all in one. GoSimpleTax will provide you with tips that could save you money on allowances and expenses you might have missed.
The software submits directly to HMRC and is the solution for the self-employed, sole traders and anyone with income outside of PAYE to file their self-assessment giving hints and tips on savings along the way. GoSimpleTax does all the calculations for you saving you ££’s on accountancy fees.
Available on desktop or mobile applications.