International Accounting Day

TaxAssist Accountants Montrose

What you need to know when filing your tax return and paying your tax bill

It’s that time of year again… Do you know that in the UK for the current tax year more than 12 million people are expected to file a self-assessment tax by 31 January 2024. What you need to know when filing your tax return and paying your tax bill

Have you already filed your tax return?

If you have already filed your tax return for tax year 2022/23, don’t forget you need to pay any tax due by 31st January 2024. You can pay early or set yourself a reminder for nearer the time. However, if you pay your income tax late, HM Revenue and Customs (HMRC) will charge interest automatically once payment is 28 days overdue.

Payments on Account become due if your self-assessment tax bill exceeds £1,000, and you may have to make these instalment payments for the next tax year. These payments must be paid in January 2024 and July 2024, so the tax bill due in January 2024 can be higher than just the current years tax liability. Each payment on account is half of the previous year’s tax bill, although you can adjust these amounts if you expect your tax liability to reduce.

If your tax return is still outstanding

Often tax payers will complete their own tax return, so it is important to check your figures are correct and you’ve claimed your full entitlement to expenses, reliefs and allowances.HMRC helpline will only deal with ‘simple’ queries such as questions surrounding PAYE coding notices or the Marriage Allowance, and they do not offer tax advice.If you are unsure, please seek expert advice from your Accountant. Your Accountant can take care of all your tax affairs for you, including registering you for self-assessment with HMRC, completing your self-assessment tax return and calculating your tax liability. Plus advising you of deadlines and due dates.However, the key thing you need to do is make sure you get your accounting and tax records to your accountant in good time and give them as much information as possible.

The deadline for paper tax returns was 31st October 2023

If you are not comfortable using Online Filing, there still was the option to file your tax return on paper, however the filing deadline was 31st October 2023, and now you would already face an automatic late filing penalty of £100. Or, depending on how late you file your return, you may face further penalties.

To get ready to file your tax return online

When planning to file your own tax return, remember that it takes time to register with HMRC, so it is important to factor in HMRC processing time.
If you have not contacted HMRC, they will not send you a tax return to complete, as it is your responsibility to register for self-assessment when necessary.

If you are out of time then use an Accountant

At this stage of the tax filing season, if you are concerned you won’t have online access to HMRC before 31st January 2024, contact an Accountant soon, as they should be able to file your tax return for you via their agent login with HMRC.You will need your Unique Taxpayer Reference (UTR) to submit your tax return. Your accountant can help you register for self-assessment and obtain a UTR if you don’t have one yet, but do not delay.The more time you have the better, so don’t leave it until 31st January to prepare your tax return. This will reduce errors and mistakes, which could be costly.

Try to avoid filing your tax return on these dates

The 30th and 31st January are the busiest days for filing a tax return, and the busiest hour is 4pm to 5pm on 31st January, and although individuals have nine months to complete a tax return, almost half of tax returns are filed in January.Don’t leave your tax return until the final day of the deadline as HMRC website and call centres, as well as your Accountant, will be under tremendous pressure to complete filings.

What happens if your file your tax return late?

A late tax return is subject to the following penalty regime:Automatic fixed penalty of £100 – even if no tax is due or tax has been paid on time

  • After 3 months, additional daily penalties of £10 per day – up to a maximum of £900
  • After 6 months, a further penalty of 5% of the tax due or £300 – whichever is greater
  • After 12 months, another 5% of the tax due or £300 – whichever is greater. Each of these penalties is in addition to one another, so a tax return filed a year late could face penalties of at least £1,600.

What to do if you cannot pay your tax bill?

Even if you cannot pay your taxes, you should still submit your tax return on time to avoid the penalties for filing late.Contact HMRC to discuss a possible payment plan or extension if you didn’t pay on time. There are late payment penalties of 5% of the tax unpaid at 30 days, six months and 12 months. You do not get tax relief for penalties.

Need help with your tax affairs?

At TaxAssist Accountants Montrose we pride ourselves on helping you take care of all your tax affairs: from registration with HMRC and completion of your tax return, to calculating your tax liability and due dates. So don’t delay, contact us today to find out more about what we can do for you on 01674 668200 or by using our online enquiry form below.