Business & Investment

Why you shouldn’t relax about taxes (even if the deadline is extended)

The tax office is merciful to us again this year, relaxing the refund deadline and allowing those who cannot afford the invoice to distribute their payments.

However, as millions of workers struggle to file tax returns by the end of the month, HMRC is giving them the opportunity to recover from the pandemic staffing crisis.

The tax office could also have deducted £ 12m of interest last year by allowing people who couldn’t prepay their invoices to stagger their payments.

Penalties: The tax office will fine you up to 30% of your claim for inadvertent mistakes and 100% if you do not knowingly declare something.

And since nearly half of us haven’t submitted yet, experts warn today that HMRC will not be so generous in the event of errors or payment delays.

Covid handout D-Day

The looming January 31 self-assessment online deadline means that millions of workers will have to face debt incurred during the difficult 2020/21 pandemic tax year.

Some of the people facing the big bill include those with government support.

Those who monetize the staycation boom by lending property must pay taxes on their belongings. So so will the people who started their own business.

HMRC announced last week that it will relax the deadline so that those who do not file by the end of the month will not face a £ 100 delay penalty if they file by the end of February.

The tax office has moved for the second year in a row after the new Omicron variant has caused havoc in claimants, accounting firms, and HM Revenue and Customs.

Strict: Experts warn that HMRC will not be so generous in the event of errors or payment delays-despite millions of pounds of tax currently being levied on Covid support payments.

Strict: Experts warn that HMRC will not be so generous in the event of errors or payment delays-despite millions of pounds of tax currently being levied on Covid support payments.

This year, more than 12 million taxpayers will have to fill out a self-assessment form and repay their unpaid balance.

This includes self-employed people, landlords, small business owners, and parents who earn over £ 50,000 and have to repay their children’s allowance. So far, about 6.9 million have been submitted.

Why it doesn’t cost money to be late

Accountants warn that taxpayers should do their best to pay interest on invoices that are not settled by the end of the month.

HM Revenue and Customs again allows up to £ 30,000 of tax obligations to be paid in installments through “time to pay”.

However, if the taxpayer does not arrange this by the end of March, the taxpayer will be fined 5% for the unpaid amount.

Fees: Last year, the tax office could have deducted £ 12 million in interest by allowing people who couldn't pay in advance to stagger their payments.

Fees: Last year, the tax office could have deducted £ 12 million in interest by allowing people who couldn’t pay in advance to stagger their payments.

According to HMRC, 123,000 taxpayers used “payment time” online to spread the cost of invoices for 2019/20.

With payments totaling £ 460m late and interest of 2.6%, the tax office can collect an additional £ 12m if all debt is repaid over 12 months.

So far this year, more than 30,000 taxpayers have chosen to diversify their debt payments worth around £ 75m.

That’s 5,000 more people than this time last year, with £ 5 million more paid. And this year, interest on debt will be added at 2.75% — an additional £ 825 on the £ 30,000 invoice.

After the Bank of England raised the base interest rate, the interest charged is still 0.15 percent higher than last year.

Penalty minefield

Approximately 700,000 people submitted their tax returns late last year after the online tax return deadline was relaxed, but they were submitted by the end of February to avoid penalties.

About 890,000 taxpayers were fined for late deadlines.

If you miss the new deadline of February 28, this year, you will automatically be fined £ 100. Then add £ 10 daily for up to 90 days.

Backlog: HM Revenue and Customs offers an opportunity to recover from a pandemic staffing crisis as millions of workers struggle to file tax returns by the end of the month.

Backlog: HM Revenue and Customs offers an opportunity to recover from a pandemic staffing crisis as millions of workers struggle to file tax returns by the end of the month.

If the form is delayed by 6 months, the tax collector will charge a penalty of £ 300 or 5% of the tax paid, whichever is higher. If you are one year late, HMRC can even claim a fine equivalent to 100% of your claim.

Experts also warn that the longer you file now, the less risk you make.

Tax collectors will fine you up to 30% of your claim for inadvertent mistakes and 100% if you do not knowingly declare something.

Those who need to file a tax return must register for self-assessment by October 5th. The deadline for paper filing was October 31st.

Accumulated bills

This month’s tax return deadline is important because it covers the amount to be paid in 2020/21, the first tax year of the pandemic, where SMEs have robbed their income and had to rely on government support.

Now self-employed and small businesses will have to liquidate their tax obligations. This includes taxes on Covid Support payments.

The Association of Certified Public Accountants (ACCA) states that this huge tax demand will hurt companies recovering from the pandemic.

Glenn Collins, ACCAUK’s Head of Policy, said:

Tax office under Kosh

Concerns: Treasury Secretary in the Shadow of Treasury Secretary James Murray

Concerns: Treasury Secretary in the Shadow of Treasury Secretary James Murray

In September, more than 60,000 callers gave up waiting for calls to HMRC. This is an increase of 22.5% compared to the same month of the previous year.

Also, in March last year, HMRC’s numerical analysis showed that two in five callers had to wait at least 20 minutes to answer the call.

Jason Hollands of Investment Platform Bestinvest said:

And Labor Party lawmaker James Murray, the Treasury’s shadow treasurer, adds:

Those who registered for self-assessment for the first time suffered a processing delay last year and had to wait a few weeks for HMRC to submit details in the post. Experts say that those who need to register this month are unlikely to be able to submit on time.

Nimesh Shah, CEO of tax accountant office Blick Rothenberg, said that if HMRC did not relax the deadline, it could have been overwhelmed by appeals for penalties.

He adds: “It’s good for HMRC that you don’t have to spend time and money managing the appeal process later.”

HMRC’s move to relax the deadline means that taxpayers have one month to file their tax returns and two months to arrange payments.

However, Michael Fitch, managing partner of UHY Hacker Young, said:

“Now, taxpayers who can’t pay taxes are unlikely to suddenly find money by the end of March,” he said.

When the deadline was announced last week, Treasury Secretary Lucy Fraser said:

b.wilkinson@dailymail.co.uk

Tips for avoiding tax bill issues

Hint: Accounting firm BDO's dawn registration

Hint: Accounting firm BDO’s dawn registration

Along Registration at dawn -Tax partner of accounting firm BDO

Covid support payment

If you request Covid’s support payment in 2020/21, the funds taxed as transaction income must be reported in your tax return. This can be a self-employed income support scheme, Eat-Out-To-Help-Out, business rate grants, tracking and tracking payments, self-isolation payments, or hiring Coronavirus for your only employee. Trades that include payments from payments for maintenance schemes (temporary dismissals).

Transaction loss

If you lose money despite Covid’s support payments, consider the best way to claim a tax exemption. By rewinding the loss for up to 3 years, you can offset the profits of the previous year and receive tax repayments.

work remotely

Those who worked from home in 2020/21 can claim £ 6 a week as an additional tax credit.

If you did not claim this with your PAYE tax code during the year, you can claim it on your tax return.

New Side Hustle Pay

If you start your business online or offline during the blockade, you must notify HMRC by October 5, last year. You need to view all your income and expenses. Alternatively, if your income is relatively modest, you can claim a £ 1,000 deduction from your total income.

Staycation boom benefits

Those who rent out real estate during the year must report rental income if it exceeds £ 1,000.

If you rent out your own home, you may be able to claim rent relief for up to £ 7,500 in income.

Claim capital loss

If you realize capital loss on your investment, don’t forget to include them in your tax return.

Otherwise, it will not be usable for future profits. You don’t have to pay taxes on the profits you make in Isauchi.

Housing profits

Anyone who sells a non-home home in 2020/21 must report this using “Capital Gains on a UK Real Estate Account” and pay taxes within 30 days of the sale.

Even if you do this correctly, you still need to disclose the profits and taxes you paid in your full tax return for the year. Don’t miss it.

Repayment of children’s allowance

If you or your partner’s annual income exceeds £ 50,000 and one of them receives a children’s allowance, you are obliged to pay a high-income children’s allowance.

If your income reaches £ 60,000, you will have to repay it in full. If you paid for it before, but your income declines during the year, you may need to get a refund.

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Why you shouldn’t relax about taxes (even if the deadline is extended)

https://www.dailymail.co.uk/money/bills/article-10390769/Why-shouldnt-relax-tax-deadline-extension.html?ns_mchannel=rss&ns_campaign=1490&ito=1490 Why you shouldn’t relax about taxes (even if the deadline is extended)

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