Today’s (6th January) announcement from HMRC gives self-assessment taxpayers, many of whom will have been dealing with COVID-19 pressures, more time to file their tax return. However, as tends to be the case with such things, this is not quite an open door for anyone simply wanting to delay their return.
What the government has said is that “late filing and late payment penalties are to be waived for one month for self-assessment taxpayers – giving them extra time, if they need it, to complete their 2020 to 2021 tax return and pay any tax due.” The reason for this magnanimity is that, correctly, the government recognises that tax payers and their agents have frequently struggled as a result of the pandemic and therefore the extra time will be of considerable help.
It will help, and for that we are grateful. However, note that the deadline to file and pay remains 31stJanuary 2022. The penalty waivers will mean that:
However, interest will be payable from 1st February, as usual, so it is still better to pay on time if at all possible.
Note also that the payment deadline under the Time to Pay scheme is only extended for those owing less than £30,000.
All in all, this is not strictly a deadline extension but rather an automatic waiver of penalty, providing you have filed by 28th February. Our aim and recommendation would still be to file by 31st January. For those clients (or anyone else seeking advice) who think they may need to take advantage of the waiver of the penalty, please get in touch.
Vivian Linstrom, M&S Accountancy and Taxation