Time is rapidly running out for millions of UK households to meet a critical tax deadline, with HMRC poised to impose significant financial penalties on those who fail to comply. The self-assessment tax return deadline falls at midnight on Saturday, January 31, marking the final opportunity for individuals to file their returns and settle any outstanding tax bills without incurring costly fines.
Imminent Financial Penalties for Late Filers
Alastair Douglas, CEO of Totally Money, has issued a stark warning to taxpayers as the deadline approaches. "Time is quickly running out for anybody who still needs to file their Self-Assessment return," Mr Douglas cautioned. "If you don’t get it in, or pay your bill before midnight on Saturday, the taxman will penalise you."
The penalties for missing the deadline are substantial and escalate over time. For late filing, HMRC will issue an initial £100 penalty immediately. After a period of three months, an additional daily charge of £10 will be applied, accumulating rapidly for each day the return remains outstanding.
Consequences of Late Payment
Separate penalties apply for late payment of any tax owed. HMRC will charge 5% of the unpaid tax after 30 days, with this penalty repeated after six months and again after a full year. Furthermore, interest will be charged on the total amount owed, adding to the financial burden for those who delay.
Mr Douglas emphasised the importance of taking action now: "If you can’t afford to pay the full amount, then contact HMRC to set up a payment plan." He outlined the simple requirements for arranging such a plan, which include providing your Unique Tax Reference number, bank details for Direct Debit setup, and details of your income and expenses.
Millions Still Need to File
Consumer champion Martin Lewis has highlighted the scale of the challenge, revealing that significant numbers of taxpayers remain unprepared. "I spoke to HMRC today," Mr Lewis stated. "There were 5.4 million people who hadn't done it at the beginning of the month; there are still 3.8 million people who need to do it, who haven't done it."
These figures, based on HMRC data from late January, demonstrate the urgent need for action among a substantial portion of the UK population. Mr Lewis urged taxpayers not to delay, warning that "the phone lines get busier, it gets tougher, it gets more difficult if you have a problem."
Practical Advice for Taxpayers
For those struggling to complete their forms accurately before the deadline, Mr Lewis offered practical guidance. "The best thing is get your form done, get it in and do it properly," he advised. However, he acknowledged that some taxpayers might find this challenging.
"If you're going to struggle to get the form done and you've got a rough idea of how much tax you should pay, pay what you think you owe now," Mr Lewis suggested. He explained that this approach can reduce interest charges, as HMRC only applies interest to the unpaid portion of the tax bill, not to any amount already settled.
Both experts strongly recommend that anyone experiencing difficulty in paying their tax bill should contact HMRC urgently to discuss payment options. The tax authority can be reached online or by telephone on 0300 200 3822, though phone lines are only operational on weekdays between 8am and 6pm.
With the Saturday midnight deadline fast approaching, UK households are urged to take immediate action to avoid unnecessary financial penalties and ensure their tax affairs are in order for the new financial year.
