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Like last year, HMRC have made some changes to the upcoming Self Assessment deadline. But the updates aren’t quite the same as last year’s. If you’re filing your 2020/21 tax return, here’s everything you need to know!
On 6th January 2022, HMRC announced that there will be no late filing penalty for people filing a 2020/21 tax return online if they file by 28th February 2022. There will also be no late payment penalty if you pay your tax bill (or set up a Time to Pay agreement) by 1st April 2022.
The regular penalties will resume from 1st March 2022 and 2nd April 2022 for filing and payment respectively. From 1st February 2022, you’ll still be charged interest as normal.
Take a look at this table to see how it will work:
|Filing date||Payment date||Penalty(filing)||Penalty(payment)||Interest|
|Before 31st Jan||Before 31st Jan||£0||£0||No|
|Before 28th Feb||Before 28th Feb||£0||£0||Yes|
|1st March onwards||Before 1st April||£100||£0||Yes|
|1st March onwards||2nd April onwards||£100||5% of bill||Yes|
For more detailed info on tax return penalties, check our late tax payment guide.
Whilst filing and paying later might seem like an attractive option, you will still be charged interest if you file/pay after the regular 31st January deadline. Interest is 2.6% APR – the standard rate for late payment – so if you’re able to get everything sorted on time, it’s worthwhile doing to avoid this charge unnecessarily.
APR stands for Annual Percentage Rate which basically means a yearly rate. The 2.6% interest charged by HMRC works out as about 0.2% of your tax bill if you file by the end of February 2022.
In their announcement, HMRC explained that they’re hoping to lessen the financial burden on taxpayers and agents that’s been increased by COVID, specifically as a result of the omicron variant.
Whenever you choose to file, don’t forget to include the following things on your tax return if you claimed them during the 2020/21 tax year:
These all count as regular income and will be treated as such when your bill is calculated. The £500 one-off payment for working households receiving tax credits, however, can be left off.
When you file is up to you, but we’d recommend not delaying unless you absolutely have to.
Otherwise you’ll incur an extra charge on your bill that you could have avoided. Treat the 31st January deadline as you ordinarily would have done.
But if you’re struggling to pay your tax bill, get in touch with HMRC as soon as you can. You may be able to set up a payment plan to spread the cost of your bill. Or click here for general help with your Self Assessment.
Take a look at our late payment calculator to work out what you might owe if you’re having to file late.
If you have any questions, don’t hesitate to get in touch with our support team on [email protected] They can help if you’re confused by what this change means for you.
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