If you receive a Tax Return, you are legally obliged to complete it, even if you think it is not relevant to you.
If you do not submit a completed Tax Return, you will be fined and HMRC may issue an estimated tax bill. This estimated bill will stand until you send in the completed Tax Return. You have only three years from the 31 January filing date to replace the estimated bill. For years where the bill has not been estimated you have four years from the end of the tax year in which to submit the return.
Completing and filing a return
Your Tax Return must normally be filed (completed and submitted to HM Revenue and Customs) by 31 October following the tax year end (5 April) if you file on paper, or by 31 January following the tax year end if you file on-line. So the 2017 Tax Return (for the tax year 2016-2017) is due by 31st October 2017, if filed by paper, or by 31st January 2018, if filed on-line. You will be sent your Tax Return – or a notice to file on-line – about May after the end of the tax year.
If you register for self-assessment late (within three months of the filing deadline or later), the deadline is extended to three months from the date of issue of the return. The revised due date will be shown on the Tax Return/notice to file that you are sent.
What happens if my tax return is late?
There are penalties for late payment of tax, late filing of tax returns and late notification of liability to pay tax.
Penalties for late filing
- You will be charged a penalty, even if you do not owe any tax.
- If you miss the filing dates of 31 October following the end of the tax year (for paper returns) or 31 January next following (for on-line submission), you will be charged a penalty of £100, and this will not be refunded, even if no tax is owing. If you are three months late, you will be charged a daily penalty of £10 per day, up to a maximum of £900
- If you are six months late there will be a penalty of £300 (or 5% of the tax owing if this is greater)
- If you are 12 months late, you will be charged another £300 (or 5% of the tax owing if this is greater). In exceptional circumstances a higher penalty of up to 100% of the tax due is possible
If you are in a business partnership the penalties apply both to the late submission of the partnership return and to the individual partner’s returns.
Penalties for late payment
- 5% of tax unpaid after 30 days
- Another 5% of tax unpaid after 6 months
- Another 5% of tax unpaid after 12 months
If you pay your tax late you will be charged interest. If your tax is due on 31 January and is not paid on time, interest will run from 1 February. You will also be charged interest on late payments on account (which are due on 31 January and 31 July).
What if I have many years’ worth of tax returns to complete?
If you are worried because you have a lot of outstanding Tax Returns and don’t know how to start completing them, we recommend you contact us on 0203 4688 788.
You may normally only submit three years’ worth of late tax returns. In some cases, HMRC may process older returns.
What happens if I don’t send in my Tax Return?
If you are sent a tax return, you are legally obliged to fill it in and send it back, even if you don’t owe any tax (even if you have not earned any money for the year in question). The only exception is if you can persuade HMRC to withdraw the tax return.
If you don’t send the return back you will be charged penalties and might be sent an estimated tax bill (called a determination). Once a determination has been made HM Revenue and Customs is entitled to the tax due as set out on that determination and can collect it through the courts – even to bankruptcy. The only way to cancel the debt is to send in a tax return to establish the correct amount of tax due.
If you need help completing your tax return please contact us.