30 Jan Everything you need to know about self-assessment late filing penalties
If you’ve not yet finalised your personal tax affairs for the 2015-16 financial year, time is certainly running out to prepare and submit your tax return to HM Revenue and Customs (HMRC).
The deadline for online tax returns to be submitted for the 2015-16 financial year is 31st January 2017. HMRC statistics show that more than half of those required to file a self-assessment tax return leave it until the final month to calculate their tax liabilities and pay the tax they owe.
However, thousands of UK taxpayers are at risk of incurring an immediate £100 late filing penalty from HMRC for failing to submit their 2015-16 tax return prior to the 31st January cut-off. Whether you’re an entirely self-employed professional or you freelance alongside a full-time job, you’ll be eligible to declare the revenue you make along with the various taxable benefits and dividends you might receive from a full-time employer.
The last thing any small business owner or freelance professional needs is to be stung with HMRC fines. These could be so easily avoided by enlisting the help of a professional accountant who can accurately calculate your tax liabilities and arrange payment for the tax you owe. If that doesn’t spur you into action, read on for the full list of late filing penalties you will automatically incur for ignoring your responsibilities for the 2015-16 financial year:
1 day late
If you fail to submit your 2015-16 tax return online on or before 31st January 2017, you will be hit with an immediate £100 fine, which will appear in your online personal tax account.
3 months overdue
On top of the immediate £100 late filing penalty, you will also accrue daily fines of £10 for the first three months that the tax return is overdue, resulting in a maximum penalty of £900.
6 months overdue
If your 2015-16 tax return is late by six months (31st July 2017), you will be hit by a further £300 penalty – or 5% of the tax you owe – whichever is the more significant sum to HMRC.
1 year overdue
If your 2015-16 tax return still hasn’t been filed by 31st January 2018, you will receive an additional £300 penalty – or 5% of the tax you owe – whichever is the greater sum to HMRC.
When you add all of those HMRC fines up, that comes to an eye-watering minimum figure of £1,600 – a sum of money that most small businesses and sole traders could certainly do without having to part with.
Whether you’re an existing small business or a new sole trader, SQK Accounting offers tailor-made accountancy packages to take away the stress of managing the books and your tax liabilities, allowing you to concentrate fully on running your business. Contact us today to find out more.