More than 5 million people are being warned not to be lulled into a ‘false sense of security’ and ensure they pay their self-assessment tax bill by the end of January 2022.
Revenue & Customs had announced that the £100 penalty for late filing is being waived provided the return is submitted before the end of February 2022. However those filing a self-assessment return must hand over any tax due for the financial year to 5 April 2021 by the end of January to avoid incurring extra costs. From February, a 2.75% charge will be applied to any tax owed. Furthermore an additional 5% will be charged if the payment is delayed by a further two months. The 5% penalty is usually levied for those who fail to a meet a 3 March deadline – this year it is extended to 1 April. Note, you can avoid paying the 5% penalty if you set up a ‘time to pay’ arrangement by the new deadline. This option allows taxpayers to spread tax owed of £30,000 or less over 12 monthly instalments.
Most importantly, postponing the completion of a tax return until February will also make it nigh impossible for someone to pay their tax bill before the end of this month.
Extract from article in Financial Mail, 9 Jan 2022