Yahoo Movies Don't be fooled by HMRC's self-assessment tax deadline extension
HMRC has extended their self-assessment tax deadline to 28 February but taxes still need to be paid by 31 January.
The new extension for completing your taxes will come as a welcome relief to many, however those who don't pay their taxes by the end of January will be liable for charges nonetheless.
Late filing usually comes with a fine of at least £100 ($137), but HMRC has said it will accept the impact of the coronavirus pandemic as a reasonable excuse if this is the case, and will cancel these fines for an extra month.
Laurence Parry, a partner at Kreston Reeves financial advisers, said: “Yesterday’s [Monday’s] announcement by HMRC is welcome but will continue to present considerable challenges for taxpayers.
“If a tax return has not yet been completed it is unlikely that the exact amount of tax due will be known, yet HMRC still requires tax due to be paid by 31 January.
“Questions will undoubtedly be asked as to why the payment date could not also be pushed back to 28 February.
“Government budgeting focuses around the 31 January tax receipts and at a time when spending is at an all-time high, changing that window is likely to have caused considerable challenges.”
READ MORE: 'A quarter' of self-employed UK workers could face double tax bill this January
For those taking advantage of the extension but still liable to pay taxes by 31 January, one possibility is to make a payment on account to HMRC approximating the amount of tax due.
If it turns out you have overpaid the difference can be reclaimed, and if you have underpaid, the interest fees will be considerably lower than if you had not paid anything at all.
For some it may not be possible to make any such payment at this time, in which case a payment plan must be arranged with HMRC no more than 60 days after the due date of the debt, if not a 5% surcharge will be applied.
If a payment plan is arranged, interest will charged on the amount.
READ MORE: HMRC to waive some late tax payment fines
Top tips for doing your taxes
Keep all the information you need to hand in one place. Whether it is your spreadsheet of invoices, UTR number, P60 or P45 forms, or your National Insurance number, doing your taxes is so much easier when you don’t have to spend half the time raking through drawers and filing cabinets for that invoice.
Don’t leave it to the last minute. Doing your taxes can be stressful enough without feeling rushed or under pressure so be sure to get ahead - you’ll thank yourself when it’s done.
Get help when you need it. If you’re in need of assistance have a look on the Gov.uk website or the TaxAid website, or if you have the means, get an accountant to check things over and deal with the paperwork for you.
Don’t forget about your expenses. If you are self-employed you can claim expenses like travel, office supplies, energy bills and other things you need to be able to work.
WATCH: Why UK tax hikes seem inevitable
