Self Assessment Deadline Extension
Article Amended on 25 January
On 25 January HMRC announced that self-assessment customers will not receive a penalty for their late online tax return if they file by 28 February. Taxpayers are still obliged to pay their bill by 31 January. Interest will be charged from 1 February on any outstanding liabilities. Taxpayers who cannot afford to pay their tax bill on time can apply online to spread their bill over up to 12 months. But they will need to file their 2019 to 2020 tax return before setting up a time to pay arrangement, so HMRC is encouraging everyone to do this as soon as possible.
HMRC Called to Extend Self Assessment Deadline
The Association of Chartered Certified Accountants has (ACCA) has lobbied the Chancellor to extend the deadline for self-assessment tax returns beyond 31 January 2021 warning that failure to do so could land millions of hard-hit entrepreneurs with fines totalling £250m.
ACCA said its members have highlighted several areas where the pandemic has intensified familiar filing deadline difficulties, as well as introducing new ones:
- A further national lockdown
- Increased need for individuals to isolate
- The worsening response times to queries raised with HMRC
- Requirement for members of staff to deal with childcare as a consequence of schools being closed
- Fewer resources available for January than planned
- Entirely new government schemes to account for; CJRS, SEISS and LRSG
ACCA urges HMRC to reconsider and extend self-assessment until the end of the tax year, in April in order to provide relief for struggling businesses. Glenn Collins, ACCA head of technical advisory and policy says that the current ramping up of pressures comes at the end of what has been an unprecedented year for accountants, as they have had to support clients with a wide range of entirely new measures, including the coronavirus job retention scheme (CJRS), self employed income support scheme (SEISS) and local restrictions support grant (LRSG), as well as advise those who have received no government support and try to manage the impact of the pandemic on their own staff and businesses.
So far HMRC has indicated that the £100 fines for late filing will be issued and then the ordinary appeals process followed, although it will regard Covid factors as a ‘reasonable excuse’ for delays. However this tactic will add to the already worrisome workload resulting from the economic fall out of the pandemic, which in itself adds to the reasoning to extend self-assessment.
In a letter to HMRC Mr Collins stated: ‘Given the fact that we now have a further national lockdown, the results from our latest survey post the lockdown announcement, the increased need for individuals to isolate, and the worsening response times to queries raised with HMRC, we would urge HMRC to reconsider and extend the deadline until the end of the tax year in order to provide relief for struggling businesses.’
Richard Halsey, of Halsey and Co in Cheam, Surrey, said: ‘We now have to spend on average three days trying to reach HMRC on webchat just to make contact as our letters and calls go unanswered.
‘That is one of the main reasons we are behind in filing – my staff are simply having to spend disproportionate amounts of time dealing with HMRC issues and assisting with the various government Covid schemes.’
Other firms have experienced difficulties because the requirement for members of staff to deal with childcare as a consequence of schools being closed, meaning fewer resources available for January than planned.
The letter from ACCA also shared that 22.2% of clients were expected to miss the filing deadline. Extrapolated across the 11.7m self-employed individuals required to file in 2020, this could potentially mean around 2.5m entrepreneurs facing penalties.
Fortunately at Prestige Business Management we are ahead of the game and other than a few brand new clients, all of our self- employed clients 2019-20 self-assessments are completed and submitted. None of our clients new or old will be fined for late filing. Contact Prestige Business Management as soon as you can if you think you are affected and at risk of missing the existing self-assessment filing deadline on 31 January. We are here to help you.
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