Breaking news: HMRC extends returns and payments deadline for millions of taxpayers
Following news that just under 6 million taxpayers are yet to submit their tax returns by the January deadline, HMRC has announced it’s waiving late filing and late payment penalties by one month for Self Assessment taxpayers for the second year.
This extension comes as a welcomed relief to many, providing extra time for those who need to complete their 2020/2021 tax returns and pay any tax due.
HMRC’s Deputy Chief Executive and Second Permanent Secretary, Angela MacDonald, states: “We know the pressures individuals and businesses are again facing this year, due to the impacts of COVID-19.
“Our decision to waive penalties for one month for Self Assessment taxpayers will give them extra time to meet their obligations without worrying about receiving a penalty.”
What exactly does the penalty waiver mean?
In essence, those who can’t file their return by 31 January will not receive a late filing penalty if they submit their tax returns by 28 February.
While for those yet to pay their Self Assessment tax, the will be a slightly longer extension.
Anyone who can’t pay their Self Assessment tax by 31 January will not receive a late penalty if they pay their tax in full or set up a Time to Pay arrangement by 1 April.
However, interest will be payable from 1 February, so HMRC does advise that you still aim to pay on time.
Don’t leave it until the last minute
While the extension comes as a welcomed surprise, if possible, do submit your returns and payments on time.
With Making Tax Digital (MTD) right around the corner, there’s no time to waste; work on the assumption of the 31 January deadline.
The penalty waiver shouldn’t be used as an excuse to file late, as the sooner you have it done, the sooner your firm can focus on the future upcoming changes.
We’ll keep a close eye on developments to see if any other changes or details emerge; in the meantime, join the discussion with me on LinkedIn.