Is the taxman’s approach to working from home making it harder for taxpayers to get help ahead of the tax return deadline?
January is a stressful time for anyone who submits a Self Assessment tax return.
It doesn’t matter if you’ve already sent yours in and paid the outstanding tax, either.
After all, you’ll still get messages from the taxman reminding you that the deadline is coming up and to ensure that everything has been submitted and paid in time.
Of course, it is obviously far more stressful if you haven’t yet sorted your tax return, with the clock ticking ahead of the possibility of fines should you miss that deadline.
And the prospects of beating that deadline become ever dicier when you consider that dealing with HM Revenue & Customs (HMRC) is not exactly straightforward at the moment.
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'I can’t get hold of anyone'
There has been no shortage of reports from taxpayers and accountants alike of astonishing waits to speak to anyone from HMRC.
While some people will have relatively simple tax returns to sort out, others may have more complex circumstances, in which case they may need to get some specific advice and guidance from HMRC staff.
The trouble is that actually getting hold of anyone is extremely difficult, with plenty of taxpayers taking to Twitter to raise their complaints.
Many have complained about having to wait up to an hour for their calls to be answered, while others have waited on hold for lengthy periods only for the call to then be cut off.
And part of the problem may be down to the way that HMRC has operated since the pandemic.
The department has embraced working from home to a greater degree than other areas of the Government ‒ only the Foreign Office had a lower occupancy rate than HMRC among the various Whitehall departments last year.
Tax experts, like those from RSM and Blick Rothenberg have suggested that HMRC is simply not equipped to deliver its services when many staff are not in a central office.
As Nimesh Shah of Blick Rothenberg put it: “Waiting times have shot through the roof since the pandemic. The department has a very bureaucratic culture. Perhaps it is not best suited to a working from home environment.”
MPs are now aware of the issue too, calling on the taxman to review its practices.
That’s all well and good for the future, but it leaves those taxpayers staring down the barrel of missing the coming deadline in a spotty position.
How many still need to pay?
Those who need to submit a Self Assessment tax return (read our tips for a painless return here) can do so at any point from the end of the tax year until the 31 January deadline, but it shouldn’t come as a huge shock that many leave it to the last minute.
Indeed, when it comes to actually paying the tax bill, you could argue that it’s wise to hold on until closer to the deadline ‒ you can keep your tax funds in a savings account, earning interest on your behalf, for a little bit longer.
However, it’s worth reflecting on the sheer number of outstanding assessments still to go in.
Figures from HMRC at the start of the year revealed that of the 12 million taxpayers expected to submit a tax return for the 2021/22 tax year, almost 5.7 million were still to be submitted and paid at the start of 2023.
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The cost of missing the deadline
It’s important to remember that missing the tax return deadline comes with some potentially punishing consequences.
First and foremost there’s the £100 fixed deadline for missing the deadline, even if there is no tax to pay.
After three months, there are then additional daily penalties charged worth £10 a day, up to a maximum of £900, if the return has still not been submitted.
If you are more than six months late, then a further penalty of 5% of the tax due or £300 (whichever is greater) is levied, while after 12 months another 5% or £300 charge is added on.
Paying early
I have been self employed since 2016, and so annual tax returns have been part of my life for a while now.
And I can say from personal experience that submitting the return early has been a big help, from both an administration and stress perspective.
In fact, I submitted my latest tax return back in June, the earliest I have ever managed it. It’s certainly true that this won’t be an option for everyone, but if there is the chance to get it in before the turn of a new year, I doubt you’ll regret it.
You don’t have to be one of the wacky sorts that submit it on Christmas Day (3,275 filed their returns this tax year) or New Year’s Eve (25,043), but getting it in ahead of the deadline ‒ and thereby avoiding some of the delays and confusion that we have at the moment ‒ is well worth it in my view.
That’s no great help for those currently battling with extensive delays to speak to someone from HMRC this year, of course. But it will hopefully mean that they don’t go through something similar in the tax years to come.
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