Those taxpayers who still chose to submit paper-based self-assessment tax returns for the tax year ended 5 April 2011 will have needed to have done so by 31 October.  For those who submit their tax returns on-line the deadline in 31 January.

HMRC has a new penalty regime for late returns which means that all returns submitted late - even by just one day – will now be subject to a fixed £100 fine.  This applies even if there is no tax to pay or the tax due has already been paid.

If the assessment is not submitted until 3 months after the deadline of 31 January then an additional penalty of £10 for every further day will be incurred until the submission is made.

So submitting 4 months late (on 31 May) will result in a penalty of £100 + £10 * 31 days (from 1 May to 31 May) – a total penalty of £410.

Six months’ delay results in a further fine of £300 or 5% of the tax due whichever is higher on top of the fixed penalty of £100 and the £10 daily fine for every day over 3 months late.  So if the return is
submitted on 1 August, all of the following penalties will be incurred:
- £100 fixed penalty
- £900 representing £10 per day for 90 days from 1 May to 29 July 
- £300 or 5% of the tax due whichever is higher.

So a taxpayer who owes £100 in tax but who doesn’t file their return until 1 August would have to pay penalties of £100 + £900 + £300 = £1,300 on top of the tax due.

Submitting twelve months late will result in an additional fine on top of those already incurred of £300 or 5% of the tax due whichever is greater.  Serious cases could be fined up to 100% of the tax due.

The run-up to Christmas is a busy time and completing tax returns can often be overlooked.  But it is important to prepare now.  For the self-employed accounting records need to be brought up-to-date, for individuals with income from property letting or other investments the income and expenses need to be calculated, and because the returns for both must be made on-line the registration and security process must be completed.

Pemberley Accounting has a great track record in working with its clients to ensure that their tax returns are completed correctly and on time thus avoiding penalties which could otherwise run into hundreds or even thousands of pounds.  Pemberley Accounting can help guide you through the process so you can enjoy Christmas knowing that your tax affairs are in safe hands, ready for the New Year.

Call Katy today on 07810 158812 for your free initial consultation.