DismayedThe self assessment tax return deadline of 31 January has come and gone – as has the extra 2 days grace thanks to the public sector strikes.  If you haven’t filed your tax return – or haven’t paid your taxes – what happens next?

Did I need to fill in a tax return?

The most common reasons (please note this is not an exhaustive list) for needing to complete a tax return are:

  • Self employed, or a member of a partnership;
  • Company director
  • Income above £10,000 from savings and investments
  • Income above £2,500 from untaxed savings and investments
  • Income above £10,000 from property (before deducting allowable expenses)
  • Income above £2,500 from property (after deducting allowable expenses)
  • Overseas income
  • Annual income £100,000 or more
  • Capital gains tax to pay

If you needed to fill a tax return you would likely have received a letter from HMRC to tell you that.  However if you didn’t receive a letter but you think you should have completed a return then you need to register for self assessment.

I needed to fill in a tax return, but didn’t

What are the penalties if you miss the tax return deadline?  If you are even one day late filing your tax return then you will be subject to an automatic £100 penalty, even if you don’t owe any tax.  The later you file your tax return, the higher the penalties, plus you could owe interest on any overdue tax.

Tax estimates

If you don’t complete a tax return in time then you may get an estimate from HMRC of tax owed.  If you get an estimate then you will have to pay it (plus penalties and any interest), but you can still change the estimate by sending in your tax return.

When do I have to pay my tax by?

Tax owed has to be paid by 31 January following the end of the tax year, together with any payments on account.  If you pay your tax late you have to pay interest on the tax due, ranging from 5% if you are 30 days late, to 15% if you are 12 months late.  You can also be charged interest on penalties that you haven’t paid!

I can’t afford to pay the tax I owe

If you can’t afford to pay your overdue tax, then contact HM Revenue & Customs as soon as possible.  They may agree to some sort of payment plan, and you may avoid further penalties and interest.