Taxpayers across the UK faced a crucial deadline as they rushed to submit their self-assessment tax returns online by midnight on Friday. Out of approximately 12.6 million taxpayers expected to file, an impressive 11.5 million managed to meet the deadline. However, 1.1 million returns remain outstanding, subjecting these taxpayers to potential fines.
The initial penalty for failing to submit a tax return on time is £100. If the return remains unfiled after three months, a daily charge of £10 is imposed, accumulating up to £900. After six months, an additional charge of £300 or up to 5% of the tax bill is levied, whichever is greater. The penalties increase again after 12 months, adding another £300 or 5% of the tax bill.
In a last-minute rush, 732,498 individuals filed their returns on deadline day. Notably, 31,442 waited until almost the final hour, submitting their returns between 11 pm and 11:59 pm. This scramble reflects the urgency felt by many taxpayers to avoid incurring penalties.
An unexpected IT outage at Barclays on the deadline day posed potential challenges for some customers attempting to pay their tax bills. In response, HMRC has confirmed that those affected by this disruption will not face late payment fines, as these will not be applied until 1 March.
“Thank you to the millions of people and agents who filed their self assessment tax return and paid any tax owed by 31 January. I’m urging anyone who missed the deadline to submit their return as soon as possible to avoid any further penalties.” – Myrtle Lloyd
Factors such as the freezing of personal tax thresholds and recent high returns on savings have led some individuals to file a tax return for the first time. Despite efforts to ease the burden by removing certain taxpayers from self-assessment, these changes have inadvertently pulled others into the process.
“The numbers show that the perfect storm of rising interest rates, reduced allowances and frozen tax thresholds in 2023-24 continued to whisk people into the tax return trap.” – Charlene Young