Tax return deadline looming

14 Dec 2021

R&D Tax Credits

It’s that time of year again when the self-assessment tax return filing deadline is looming large. Returns need to be filed by the 31 January deadline to avoid a late filing penalty. Many will also need to pay a balancing payment in respect of their 2020/21 liability and a payment on account of their liability for the current 2021/22 tax year by the same date.

Late tax payments will attract interest. Martyn Dobinson, partner, and a member of the firm’s Land and Rural Practice Group, says:

“For many it is not just a case of having the numbers prepared and the return submitted, but also having funds available to meet the payments due.”

HMRC will accept certain ‘reasonable excuses’ for the late submission of an annual tax return or late payment, these being:

  • Your partner or another close relative died shortly before the tax return or payment deadline.
  • You had an unexpected stay in hospital that prevented you from dealing with your tax affairs.
  • You had a serious or life-threatening illness.
  • Your computer or software failed just before or while you were preparing your online return.
  • There were issues with HMRC online services.
  • A fire, flood or theft prevented completing your tax return.
  • There were postal delays that could not have been predicted.
  • There were delays due to a disability you have.

HMRC says that a return or payment must be sent as soon as possible after the circumstances leading to the missed deadline are resolved.

Where tax obligations are missed due to Covid-19, HMRC may accept that as a reasonable excuse, but the taxpayer must explain how they were affected by Covid-19 in their appeal and how that led to the deadline being missed. The return or payment must still be made as soon as possible.

HMRC will not accept the following excuses as reasonable:

  • Reliance on someone else to send your return who did not.
  • A cheque bouncing or payment failing because you did not have enough funds available to cover the payment.
  • Finding the HMRC online system too difficult to use.
  • Having not received a reminder from HMRC.
  • Making a mistake on your tax return.

Martyn adds:

“Given that returns will need to be made and tax paid anyway, it’s much easier to meet the end-of-January tax filing and payment obligations if at all possible, rather than to have to dispute penalties and interest with HMRC. Any delays should only be in exceptional circumstances. Dealing with disputed penalty and interest notices can be time consuming and stressful and detract from getting on with your business. If in any doubt your professional advisor will be able to give you the best advice and support if issues should arise.”