A record 10.7 million people got their tax returns in on time before the end of January, HMRC figures have revealed.
However, more than 758,000 of those left it right to deadline day. And despite warnings of the consequences of missing the cut-off time of midnight on January 31, 746,000 people actually missed the deadline to file their self-assessment tax return.
And they are now facing an initial £100 penalty, even if there is no tax to pay, followed by possible further penalties, depending on the lateness of filing.
The present system means HMRC can demand £100 for late filing during the first three months after the deadline.
After three months, additional penalties of £10 per day can be charged, up to a maximum of £900, followed by further charges six and 12 months after the deadline.
And in addition to the late submission penalties, HMRC charges interest on late paid tax and surcharges of five per cent of the tax unpaid 30 days and then six months after the due date.
Angela MacDonald, director general for customer services at HMRC, has urged those who missed the cut-off to work quickly and get their return in.
She said: “If you’re one of the small number that missed the deadline, please submit your return now to avoid further penalties. We really don’t want penalties, we just want tax returns.”
There are changes afoot. The government says it is working on plans to introduce a points-based system, similar to driving offences, for those who fail to submit their returns on time, rather than an automatic fine.
They would receive points and have to pay fines after a certain threshold was reached. And like speeding, points would be wiped clean after a certain period of time.
However, it is important to stress these planned changes are still some way ahead.
And the question remains, whatever the system for penalising late submissions, why risk it in the first place?
January is a hectic time for all as people leave it right to the last minute to tackle their tax return, creating the big rush.
Many who fill their own forms out go right down to the wire. Others who get professional help for the process are slow at sending through the information needed. Either way it causes problems and pain for many every year.
According to the Daily Mail the most popular hour for people to hit “submit” on 31 was between 4pm and 5pm – when more than 1,000 returns were being received every minute typically.
However, the benefits of getting your tax return in early are there for all to see. And it is not all about ensuring you avoid penalty payments.
For one thing, it means you can discover your tax liability payments in advance, and can plan for these if necessary. And, if you are due a repayment, you will get it earlier!
So it pays to get organised and start the process earlier. The tax team here at WNJ is on hand to ensure there is no panic or last minute rush to beat the deadline.
You can contact us on 01772 430000 to discuss any aspect of your tax.