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Self Assessment Deadlines and Penalties

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What do you know about self assessment deadlines and penalties?

Do you need to do a self assessment?

Do you fall under the regime of someone who needs to do a self assessment?

This would mean you’re either self-employed as a sole trader (earning more than £1,000 in the tax year), or a partner in a business partnership.

You may also need to send one if you have any other untaxed income:

  • some COVID-19 grant or support payments
  • money from renting out a property
  • tips and commission
  • income from savings, investments and dividends
  • foreign income

If you’re unsure whether you fall into this category, ask your accountant, or check out the government website which gives full details.

If this is you, here are the deadlines and penalties you need to be aware of when doing your self assessment:

Deadlines:
5th October – Register for Self-Assessment

You must notify HMRC by 5th October if you fall under the self assessment regime

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​31st October at midnight – File Your Paper Tax Return

HMRC encourages taxpayers to file their tax returns online, which can be done through the HMRC website or using software, but in some cases, it may still be necessary to file a paper return. Paper returns must be filed by midnight on 31st October at the end of the applicable tax year. Please note that this is the date by which HMRC must receive your return. Therefore, please allow enough time to print the forms, complete them and send them to the HMRC.

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30th December – Collect any tax due through your PAYE code for the next tax year

Do you file your tax returns online and also have earnings taxed under PAYE? Then, you can choose to have overdue tax collected via PAYE. But, for this to be allowed, your self-employed tax bill must be below £3,000, and you must file your online return by this date. The advantage of this is that any tax payable would be paid over 12 months from April,  rather than in a single lump sum by 31st January.

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31st January by midnight – submission and payment of tax due

If, like most people, you submit your tax return online, then the deadline for submission and payment is midnight on 31st January. Any tax due must be paid by this same date along with a first payment on account (if relevant).

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31st July by midnight – 2nd payment on account due

Payments on account’ are advance payments towards your tax bill (including Class 4 National Insurance if you’re self-employed). You normally have to make 2 payments on account every year unless:
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  • your last Self Assessment tax bill was less than £1,000
  • you’ve already paid more than 80% of all the tax you owe, for example through your tax code or because your bank has already deducted interest on your savings

Each payment is half your previous year’s tax bill. Payments are usually due by midnight on 31 January and 31 July.

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Penalties:
Late filing penalties for Self Assessment

Time after 31st Jan deadline        Penalty
1 day                                                                            £100
3 months                                                                     £10 daily up to 90 days (max £900)
6 months                                                                     5% of tax due or £300 (whichever is greater)
12 months or later                                                     5% of tax due of £300 (whichever is greater)

Additional penalties may be applied if HMRC believes the taxpayer is intentionally withholding information or trying to evade tax.

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Late payment penalties for Self Assessment

HMRC will issue the penalties if you do not pay your tax when it is due.

Lateness                         Penalty
30 Days                                     5% of tax due
6 months                                   5% of tax due at that date
12 months and later                5% of tax due at that date

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If you don’t have an accountant or you are looking for an accountant, you’re more than welcome to get in touch with me, to see if I’d be the right fit for you/your business.

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