The Association of Chartered Certified Accountants has called for Friday’s self-assessment deadline to be extended, as new tax rules mean many will be filing a return for the first time.
One of the UK’s leading accountancy bodies has called on HM Revenue & Customs (HMRC) to postpone the 31st January deadline for submitting a self-assessment tax return.
The call by the Association of Chartered Certified Accountants (ACCA) follows reports from HMRC that around 1.5 million self-assessment tax forms have yet to be filed.
ACCA head of taxation Chas Roy-Chowdhury said HMRC should "do the right thing" as there are a higher number of newcomers to the process this year that may be struggling to meet the deadline.
Newcomers
A total of 10.5 million self-assessment tax returns are expected for the 2012-2013 tax year.
The ACCA says this number has ballooned largely because of changes to the Child Benefit system and an increase in self-employed workers.
Many parents will be completing the self-assessment return for the first time after the introduction of the High Income Child Benefit Charge last year.
The new tax rule means that a household where one parent earns between £50,000 and £60,000 will have to pay a proportion of the Child Benefit they receive back through the tax system.
The charge is 1% of the Child Benefit paid for every £100 of income earned over £50,000. For those earning above £60,000 the tax charge is 100% of the amount of Child Benefit received.
Around one million high-earning parents have been hit by the High Income Child Benefit Charge which came into force on 7th January 2013.
But it is feared these newcomers that have been thrown into self-assessment will struggle to get to grips with it all.
[SPOTLIGHT]ACCA head of taxation Chas Roy-Chowdhury said: “HMRC has a common-sense decision to make. Either it can stick to the deadline and penalise all those families and self-employed people who are struggling to get to grips with the self-assessment process, or it can do the right thing and give them a lifeline by extending the deadline.”
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Penalties
HMRC said the deadline is a statutory one and cannot be extended.
If you miss the 31st January deadline to file your tax return you will automatically be fined £100. You will then be fined £10 each day for the next 90 days up to £900. So after three months you could be fined £1,000. These penalties apply even if you don’t have any tax to pay and it gets worse the longer you leave it. After six months, a further penalty of 5% of the tax due or £300, whichever is greater, is levied and after 12 months, another 5% or £300 charge, whichever is greater.
If you miss the 31st January deadline to pay any tax you owe you will also be charged interest. After 30 days you will be charged 5% of the tax you owe. The same charge applies if you are six months late and if you are 12 months late. These charges have to be paid in addition to any penalties owed for filing your return late.
According to HMRC nine million tax returns have been filed already, with 362,000 filed yesterday alone.
Finding help
If you need help filling out your self-assessment form before the deadline read Tips for filing your self-assessment tax return at the last minute.
And to make sure you don’t make any mistakes in the rush read How to get your online self-assessment tax return right.
The HMRC website also has tools and information to help you work out what you owe.
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More on tax:
The best places to keep your tax bill money
Working from home: how to get a tax rebate
“I had a run-in with a cow”: the strangest reasons for late tax returns