Self Assessment Taxpayers Granted Breathing Space Ahead of Filing Deadline
HMRC has announced it is waiving penalties for late filing of self assessment tax returns for one month beyond the January 31st deadline.
The decision represents an extension of a policy put in place last year and is designed to offer some breathing space to anyone impacted by the widespread disruptions of the pandemic.
As of early January 2022, an estimated 6.5 million people are understood to have already submitted their self assessment tax returns, with a similar number initially obliged to do so by the end of the month.
However, whereas anyone missing that deadline might ordinarily have expected to suffer an automatic £100 fine, that sanction will instead kick in at the end of February.
HMRC has made clear as well that no one should be subject to fines if their returns are submitted before the end of February, with anyone who cannot pay their tax amounts upfront asked to enter a ‘Time to Pay’ arrangement no later than the start of April.
Interest on outstanding amounts of unpaid tax will still begin to accumulate from February 1st, so HMRC has sought to emphasise to self assessment return filers the advantages of paying on time where possible.
HMRC’s deputy chief executive Angela MacDonald has explained the decision to effectively extend the tax return deadline by highlighting the challenges that the pandemic continued to present businesses and self-employed traders throughout 2021.
“We know the pressures individuals and businesses are again facing this year, due to the impacts of Covid-19,” she said.
“Our decision to waive penalties for one month for self assessment taxpayers will give them extra time to meet their obligations without worrying about receiving a penalty.”
Lucy Frazer, financial secretary to the Treasury, added that the government sees the policy on self assessments as a way of helping the many people whose circumstances have been adversary affected recently by the spread of Omicron.
“Waiving late filing and payment penalties will help ease financial burdens and protect livelihoods as we navigate the months ahead,” she said in a statement.