Be aware of tough penalties for late self-assessment tax returns

Esther Shaw / 12 January 2016

The deadline for filing self-assessment tax returns online is 31 January. Read our tips to avoid a penalty fine for submitting a late return.



Self-employed workers and other self-assessment taxpayers need to take action if they have yet to file their tax return to HM Revenue & Customs, as those who miss the January 31 deadline face hefty penalties.

While the deadline for paper tax returns passed a few months ago on 31 October, you can still file online until the end of this month.

People who work for themselves, and those with more complex tax affairs involving rents or investments above a certain level, will need to complete a return; this must cover any untaxed income from the 2014-15 tax year.

If you are late sending the relevant forms and any tax owed to HMRC, this could prove very costly.

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What fines do you face?

Those who file after 31 January will be hit by an automatic one-off fixed penalty of £100.

The longer you delay, the more expensive it gets.

If you have still not completed the forms after three months, you will be charged £10 a day – up to a maximum of £900.

After six months, an additional 5% of tax due, or £300 – whichever is greater – will be added.

Further penalties are then levied at 12 months if your tax return has still not been completed.

Five things you might have to pay tax on.

Be prepared

If you haven’t filed online before, you will need to register for an activation code. It can take about 10 days to get the user ID and password needed through the post – so make sure you leave enough time to get this.

You can register for self-assessment here.

Get your affairs in order

Before starting to fill out your tax return, you should gather together all the necessary paperwork.

If you don’t have the information to hand, make early requests to your employer, bank, and other organisations.

This might include:

  • Details about your income, such as your P60, P11D and payslips, or, if you’re self-employed, details of your accounts and records of expenses.

  • Statements from banks and building societies showing records of interest received.

  • Details of pension contributions made.

  • Information about Gift Aid donations.

Six taxes you can legally avoid.

Declare all earnings

As a self-assessment taxpayer, remember to include everything you’ve earned over the tax year from 6 April 2014, to 5 April 2015.

This includes income from employment, self-employment, income from property, and interest and gains from your savings and investments.

Check your return

When filing online, you can save your tax return at any time, coming back to it later if you don’t have time to fill in everything in one sitting. Your tax will be calculated automatically as you fill in the return.

Before sending your return, make sure you have double-checked all the information you have provided to ensure there are no mistakes. Once you are happy, press the “submit” button – and wait for your confirmation code.

Most importantly, remember to pay any tax due.

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A reasonable excuse

While penalties may be waived if you can provide a “reasonable” excuse, there are very excuses that HMRC will accept for late filing. Those it will accept include the recent death of a partner or a serious illness.

HMRC has also said it will accept a customer has a reasonable excuse if the delay is caused by flooding at the premises – as long as the return is then submitted without unreasonable delay.

Make sure you meet the deadline

As a self-assessment taxpayer, it is worth doing all you can to avoid filing late.

Don’t leave everything until the last minute; act now and ensure you submit your online tax return on time.

If you have any problems or queries, you can call HMRC’s online services helpdesk on 0300 200 3600.

For more useful tips and information, browse our money articles.

The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.