If you have not yet paid your balancing payment of income tax due for the year ended 5 April 2018, (which was payable by 31 January 2019), a 5% penalty will be charged by HMRC if this liability is not paid in full by 30 days after the payment date.
Late payment interest will also be charged on all income tax liabilities not yet paid, relating back to the original payment date. This is currently charged at 3.25% per annum.
Details on how to pay HMRC can be found below:
What can I do if I cannot afford to pay?
If you are unable to pay your income tax liability HMRC may consider setting up a payment plan so you can pay by instalments, however, they will ask for details of all income and outgoings as part of this decision process:
Not even submitted your 2018 Self-Assessment Tax Return yet?
What are the penalties if my self-assessment tax return is late in being filed?
• You’ll get a penalty of £100 if your tax return was not filed by the due date and is up to 3 months late.
• After three months a further £10 per day penalty is charged for up to the next 90 days (so up to £900).
• After six months, the penalty rises even further to include 5 per cent of the tax due or £300, whichever is greater.
• Twelve months late, a further penalty of 5 per cent of the tax due or £300, whichever is greater.
So, the total fines for filing a personal tax return a year late will come to £1,600!
Whilst we cannot stress the importance of completing your self-assessment tax return before the deadline, unfortunately there are certain things that happen which mean your tax return could be a little late. HMRC understand this and allow for reasonable excuses. For example, if the taxpayer was suffering a serious illness which then prevented him/her managing his/her affairs, there is a bereavement in the family, spending unplanned time in the hospital or there was a fire/flood or theft. Additionally, the full list of reasonable excuses can be found here: https://www.gov.uk/tax-appeals/reasonable-excuses.
However, HMRC also released a list of the rather creative excuses people gave for not completing their tax return on time. However, here are some of Cardens favourites!
1. I’m too short to reach the post box
2. My mother-in-law is a witch and put a curse on me
3. My child had scribbled all over the tax return, so I was unable to send it back
For more information on how Cardens can help, call us today on 01273 739592