The taxman today granted a reprieve for self-employed Brits by waiving penalties for late filed tax returns.
Anyone who fails to file their self-assessment tax return by January 31 will not be slapped with a fine by HMRC.
However, Brits filing their tax returns after February 28, the new deadline, will be hit with a penalty issued by HMRC for submitting returns late.
Brits that miss the January 31 deadline will still be charged 2.75 per cent interest on any late paid tax bills.
A five per cent late payment fine will also be levied if tax remains outstanding, and a payment plan with HMRC has not been set up, by midnight on 1 April 2022.
Dawn Register, head of tax dispute resolution at BDO, said: “This is a softening of the filing deadline, but the payment deadline remains unchanged, so interest will still begin to accrue from February 1 if personal taxes are not paid by January 31.”
The decision to waive tardy tax filing penalties was taken to alleviate the pressure on the 5.7m Brits who have not filed their self-assessment return yet.
Pandemic-related pressures have made gathering enough information to complete tax returns much harder, delaying the process for many self-employed workers who file their returns themselves.
Angela MacDonald, deputy chief executive of HMRC, said: “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,” she added.
Register did praise HMRC’s move for giving taxpayers extra headroom.
“HMRC clearly understands that those severely impacted by Covid-19 should not face receiving a ‘brown envelope’ in February as it would result in unnecessary angst,” she added.
However, she urged those who can file and are able to pay tax by January 31 to do so.
The taxman waived late filing penalties for a month last year in a bid to ease pressure on individuals and accountants amid pandemic-related disruption.