HMRC £100 fine warning to millions of people due to file tax return before deadline next week

Some 3.4 million people have around a week left to file their tax return or face potential penalties.HM Revenue and Customs (HMRC) is reminding people to file on time or risk missing the January 31 deadline - and getting an initial £100 penalty.

Some 8.6 million people have already filed their 2023/24 tax return. Myrtle Lloyd, HMRC’s director general for customer services, said: “Time is running out for the millions still to file their self-assessment tax return by January 31. Help and support is available for those who have not yet started their return. Visit gov.uk and search ‘self assessment’ to find out more.”

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HMRC said people should include their bank details as part of their tax return to ensure that if there is any repayment due, it can be done quickly and securely.

Excuses for not paying a tax bill or arranging a payment plan by the deadline will be considered on an individual basis, the revenue body said.

Those who provide HMRC with a reasonable excuse may avoid a penalty.

Help filling in Self Assessment tax return

Advice Direct Scotland offers a free tax helpline and website, taxadvice.scot, backed by HMRC, to help you understand your tax obligations. If you need help navigating the self-assessment process, you can call a specialist adviser on 0800 756 3381.

Andrew Bartlett, chief executive of Advice Direct Scotland, said: “Time is running out. There’s not much time left to get your self-assessment return in order and pay any tax you owe to HMRC, so if you have been putting it off, you should act now.

“If you don’t meet the deadline at the end of this month, you will start to accrue fines on top of your 2023/24 tax bill, which will get steeper the longer you delay.

“If this is the first time you’ve gone through the process, don’t worry - our advisers can assist people struggling to fill in their Self Assessment forms or who have any other queries about their tax obligations, completely free of charge.”

HMRC has a wide range of resources online including a series of video tutorials on YouTube, help and support on GOV.UK, to support customers in completing their tax return.

For people who can’t meet the tax return deadline, HMRC will treat those with reasonable excuses fairly if they tell us before January 31.

The penalties for late tax returns are:

• an initial £100 fixed penalty, which applies even if there is no tax to pay, or if the tax due is paid on time

• after 3 months, additional daily penalties of £10 per day, up to a maximum of £900

• after 6 months, a further penalty of 5% of the tax due or £300, whichever is greater

• after 12 months, another 5% or £300 charge, whichever is greater

There are also additional penalties for paying late of 5 per cent of the tax unpaid at 30 days, 6 months and 12 months. If tax remains unpaid after the deadline, interest will also be charged on the amount owed, in addition to the penalties above.

Who needs to file a Self Assessment?

Taxpayers may need to complete a tax return, even if they pay taxes through PAYE, for example, if they:

• are self-employed and have earned gross income over £1,000

• are self-employed and earned up to £1,000 and wish to pay Class 2 NICs voluntarily to protect their entitlement to State Pension and certain benefits

• are a partner in a business partnership

• had a total taxable income of more than £150,000

• have received any untaxed income including pension income over £2,500

• received income over £1,000 from trading or providing services online

• have to pay the High Income Child Benefit charge

• received interest from banks and building societies or investments (more than £10,000)

• received rental or letting income from UK land and property

If someone regularly sells goods or provides services through an online platform, they may need to pay tax on their income.

People can find out more about selling online and paying taxes on GOV.UK by searching ‘online platform income’ or by downloading the HMRC app. The guidance will help them decide if their activity should be treated as a trade and if they need to complete a Self Assessment tax return.