It’s that time of year again! There is now just over one week left to file your personal tax return with HMRC for the 2018/19 tax year. If you miss the 31st January deadline then you will automatically be issued with a £100 penalty regardless of whether there is any tax due or not. Be aware that this penalty will increase if your tax return is more than three months late.
It is not only individuals that have been issued with a Notice to File a Tax Return that have to be concerned with filing a tax return. You may also have to file a tax return if you fall within any of the following categories; if you were self-employed, a partner in a business, a company director, a minister of religion, a trustee or an executor of an estate, if were in receipt of untaxed income of more than £2,500 from the rental of a property or from savings and investments, if you had income from outside the UK, if you lived abroad and had UK income, if you had savings and investment income of at least £10,000 (before tax), if your income was over £50,000 and you were in receipt of Child Benefit, or if your annual income was more than £100,000.
Also, if you sold an asset during 2018/19 and it made a gain of more than the annual exemption (£11,700) or the total proceeds were more than £46,800 then you may also have to report this in the Self-Assessment Tax Return.
If any of these categories apply to you or if you are not entirely sure then it is advisable that you speak to an accountant.
Any tax liability due for 2018/19 is also to be paid to HMRC by 31st January 2020, but if you have already made payments on account towards 2018/19 then it is the balancing amount that is due to HMRC. You may also have to make a payment on account towards 2019/20 unless your tax liability is less than £1,000 or you have already paid more than 80% of your tax due. If you fail to make this payment by 31st January then you will incur interest on any late payment, with a 5% penalty if the payment is more than 30 days late. You may incur more interest and penalties the longer the tax liability remains unpaid.
There are a number of different methods to pay your tax bill, you can post a cheque direct to them making the cheque payable to HMRC followed by your UTR Number (allowing 3 working days for the cheque to clear). If you have a paying in slip from HMRC then you can take this, along with the payment, to your nearest bank or building society. You can also pay online with either a debit card or by making a bank transfer (using Faster Payments, CHAPs or Bacs).
In order to avoid any unnecessary penalties and interest arising it is best to get all your information gathered together and get your tax return filed, and any liabilities paid, on time.