The self-assessment tax return deadline was 31st of January and if you didn't get your return in on time, you will be slapped with a £100 fixed penalty.
It's important to get your completed return and any tax owing in as soon as possible as further penalties come thick and fast. If you have still not submitted your return and payment by the end of February, you will receive a late payment penalty equal to 5% of the tax owing.
In addition to the penalty, you will also be charged interest on the late payment of any tax owing. Interest starts to accrue from the day after the tax return was due. If you haven't completed your tax return, you won't know how much tax you own and therefore how much interest you will be charged. You may be able to estimate the likely amount you owe using the HM Revenue and Customs estimate your penalty tool.
Completing your tax return should be relatively straightforward providing you have all your paperwork in order. You will need to gather the information relating to any income from employment and records pertaining to any periods of self-employment over the period covered by the tax return including income and expenditure, information on any business use of vehicles and any other income such as capital gains or share profits.
The HMRC online filing system tailors the tax return in response to your answers to a few simple questions. This means you will only need to complete the sections relevant to you and your business. It will also allow you to save any information you have entered so far if you need to go away to find further information or complete it in more than one sitting.
Another benefit of using the online tax return system is that you will know exactly what you owe in tax as soon as you submit your return as the system will calculate your tax bill for you.
You will need a Government gateway account before you can sign in and you'll have to complete your self-assessment tax return. If you do not have a Government gateway account, you will need your unique taxpayer reference and National Insurance number in order to set one up.
You will be sent an activation code once you have entered your details. However, this can take up to a week to arrive - further delaying your tax return and ramping up your interest.
If you still have not submitted your return by 1 May, HMRC will charge you £10 per day for each additional day the return is late. And if you have still not submitted it after six months, you will be landed with a minimum £300 fine or 5% of the tax owning - whichever is greater. So the advice is, act now if you want to avoid further interest and penalties.
- A guide to tax penalties
- Home expenses to claim when you're self-employed
- Find out what records you should be keeping
