Tax return deadline looms: how to beat the finesFile your return by 31 January or face a £100 fine

09 January 2013

Tax return

With time ticking away, we explain the fines and penalties you could face if you fail to file your tax return online before the 31 January deadline.

Making a tax return online is fairly straightforward but if you have any tax-related questions, the Which? Money Helpline has a team of qualified experts that can help answer them. Sign up to Which? for just £1 and speak to one of our experts.

How to fill in an online tax return

Most UK taxpayers have tax deducted at source (via Pay As You Earn, or PAYE) and don't need to fill in a tax return. However, around nine million people need to complete a self-assessment tax return (SA100 or SA200) and submit this to their tax office.

The deadline for filling a paper tax return (31 October) has now passed. You now have until 31 January to fill out your tax return online.

If you are filing online for the first time, follow our 10-step guide to submitting a successful tax return online.

Penalties and fines if you miss the tax return deadline

If you miss the 31 January deadline, the longer you delay, the more you'll have to pay so it's important to send your tax return to HMRC as soon as you can. Here are a list of penalties if you are:

One day late

You will automatically receive a £100 fine. This applies even if you have no tax to pay or have paid the tax you owe.

Three months late

A fine of £10 for each following day up to a 90 day maximum of £900. This is in addition to the fixed penalty above, so the overall fine could be £1,000.

Six months late

A fine of either £300 or 5% of the tax due, whichever is the higher, will apply on top of the penalties above.

12 months late

Another £300 fine or 5% of the tax due, whichever is the higher, will be added to your bill on top of the penalties above. In serious cases you may be asked to pay up to 100% of the tax due instead, as  well as any tax you owe, doubling your payment. 

Receiving a tax estimate if your tax return is late

If you don't send your return by the 31 January deadline, HMRC may estimate the tax you owe. You will have to pay this and also pay interest on any tax that you pay late. You can only change this estimate by sending your tax return. You will also have to pay any penalties due for missing the tax return deadline.

Use our tax calculator to work out how how much tax you owe.

Late payment penalties

If you fail to pay on time, things get worse as you'll be charged interest from the date the payment was due. The interest rate varies but you can check the current rate payable on HMRC's website.

If any of your tax bill for 2011/12 remains unpaid by 2 March 2013, you'll be charged a 5% surcharge. An additional 5% is imposed on any of the tax bill which is unpaid by 2 August 2013. Another 5% is added if a full year goes by.

Incorrect tax return penalties

There is a system of penalties for mistakes on your tax return, depending on whether HMRC thinks you have been careless or have tried to mislead them.

Incorrect tax return penalties are based on the amount of tax you owe, and are payable in addition to the tax owed. 

If you have taken reasonable care to fill in your return correctly, you will not have a penalty to pay but:

  • If you have been careless, the penalty will be between 0% and 30% of the extra tax owing.
  • If you have deliberately underestimated your tax, the penalty is between 20% and 70%.
  • If you have deliberately underestimated your tax and attempted to conceal the fact, the penalty will be between 30% and 100%.

Penalties may be reduced according to how much you cooperate with HMRC. 

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