On the 6th January 2022, HMRC announced that they were waiving late filing and late payment penalties for Self Assessment taxpayers who either hadn’t yet filed their tax returns or paid their personal tax liabilities.
HMRC is still encouraging taxpayers to file and pay in time if they can, but they recognised that just over half of the taxpayers who are required to file a tax return hadn’t at that date.
HMRC recognise the pressure faced by the majority of taxpayers and their agents this year due to COVID-19 as it has affected the capacity of many to meet their deadlines, and as such have given a further month to have the returns filed.
The Tax Return filing deadline remains at 31st January 2022 for the 2020-21 Tax Return, however, the penalty waiver means:
- anyone who cannot file their return by 31st January 2022 will not receive a late filing penalty if they file online by 28th February 2022.
- anyone whom cannot pay their Self Assessment tax by the 31st January 2022 will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement by 1st April 2022.
Interest will be payable of any tax that is owed, from the 1st February 2022, so it will still be better to pay in time if possible,
The existing Time to Pay service allows any individual or business who needs it the option to spread their tax payments over time,. Self Assessment taxpayers with up to £30,000 of tax debt can do this online once they have filed their return.
Normally late filing penalties are applied to all returns due on but filed after the 31st January deadline, only being cancelled if the taxpayer has a reasonable excuse.
Likewise, late payments of Self Assessment Tax incur a 5% late payment penalty for amounts outstanding
