HMRC offers support to businesses struggling to complete Self Assessment tax returns

HMRC has warned four million customers are yet to submit their completed Self Assessment tax return and pay any tax owed ahead of the deadline on January 31.

More than 12.2m customers are expected to complete a tax return for the 2020 to 2021 tax year.

HMRC is urging the millions of customers still to file their tax return, pay any outstanding liabilities or set up a payment plan, to do so ahead of the deadline as interest will be applied to all outstanding balances from February 1.

However, earlier this month, HMRC announced they would waive penalties for one month for late filing of tax returns and late payments. The changes mean:

• Anyone who cannot file their return by the January 31 deadline will not receive a late filing penalty if they file by February 28

• Anyone who cannot pay their tax liabilities by the January 31 deadline will not receive a late payment penalty if they pay their tax in full, or set up a time to pay arrangement, by April 1

Myrtle Lloyd, HMRC’s director general for customer services, said: “We know some customers may struggle to meet the Self Assessment deadline on 31 January which is why we have waived penalties for one month, giving them extra time to meet their obligations.

HMRC is offering support to customers completing their tax return. Anyone who is yet to file their return can book a place to access live webinars, running throughout January. In addition, HMRC has produced resources to help customers meet their obligations including YouTube videos and Self Assessment guidance.

The existing Time to Pay service allows any individual or business who needs it the option to spread their tax payments over time. Self Assessment taxpayers with up to £30k of tax debt can do this online once they have filed their return.    

The 2020 to 2021 tax return covers earnings and payments during the pandemic. Taxpayers will need to declare if they received any grants or payments from the COVID-19 support schemes up to April 5 2021 on their Self Assessment, as these are taxable, including:

• Self-Employment Income Support Scheme
• Coronavirus Job Retention Scheme
• Other COVID-19 grants and support payments such as self-isolation payments, local authority grants and those for the Eat Out to Help Out scheme
• The £500 one-off payment for working households receiving tax credits should not be reported in Self Assessment.

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