Self Assessment Deadline Extension, Late Payments, Tax Credits and Time to Pay
Self Assessment Deadline Extension
Late Filing
HMRC have said that late filing penalties would be waived for self-assessment tax returns submitted online by midnight on 28 February 2022, penalties would have been incurred for returns not submitted by 31 January 2022. We would still like all clients to have submitted returns on time where possible, i.e. by 31 January 2022
Late Payment
Tax liabilities due on 31 January 2022 will have no 5% surcharge applied if they are paid, or a payment arrangement is made, by 1 April 2022. Interest will be charged at 2.75% from the 31 January 2022, so please try to pay by the original date if possible.
Tax credits
Tax credit claimants who have submitted an estimated amount of their earnings for 2020/21 need to finalise those figures by 31 January 2022. There is no extension to this deadline.
However, if the taxpayer is late with their tax credit figures and does provide the final details by 28 February, HMRC will use its discretionary powers to re-make the decision if the delay was due to Covid-19. HMRC will also not be expecting customers to prove the delay to the tax credit finalisation was due to the pandemic.
Time to pay
As detailed in our tax return letters, a time to pay arrangement will be approved automatically (when requested) once the 2020/21 tax return is submitted, and the following conditions are met:
- the taxpayer owes less than £30,000
- the application was made within 60 days of the payment deadline
- the agreement will result in the tax debt being cleared completely within the next 12 months or less
The taxpayer needs to set up a direct debit to pay the tax by instalments and needs to be able to pay the first instalment immediately.
How to set up a time to pay arrangement: https://www.gov.uk/difficulties-paying-hmrc/pay-in-instalments
If the amount due is more than £30,000 or the taxpayer can’t pay it all within 12 months, they need to contact the self-assessment payment helpline: 0300 200 3822 to make a bespoke time to pay arrangement.
