Self Assessment tax returns must be completed by midnight January 31, 2022 and HMRC notes this will primarily impact the self-employed, investors and those in receipt of certain benefits such as Child Benefit. Unlike other deadlines issued throughout the year, two elements of the tax return must be completed on the same day in January.
Online tax returns
Online tax returns must be completed by January 31 and these are filed by the self-employed or those who are not freelancers but who still need to send a return. An example is those who receive income from renting out a property.
The online service can also be used to view returns made before, check personal details and print out a tax calculation. While many may need to utilise the online service, it should be noted online tax returns cannot be filed for partnerships, trusts or estates, and certain other taxpayers.
To file an online return, Britons will need to head to the Government’s website. They’ll need to prove their identity using the Government Gateway or GOV.UK Verify.
When using this service, taxpayers will not have to complete their return in one go, they can save their entry and go back to it later if they need to. However, all payments owed must be paid by January 31, 2022.
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Paying a Self Assessment tax bill
Generally, the deadlines for paying a tax bill are usually January 31 for any tax owed for the previous tax year (known as a balancing payment) and a first payment on account. Following this, a second payment on account may be due on July 31.
It is important to pay HMRC by these deadlines as interest will be charged to the debt and penalties may be issued if the payment is late. The time needed to dedicate to this will depend on how the taxpayer intends to pay. There are many ways to cover what’s owed but it is no longer possible to pay at a Post Office.
To ensure the payment goes through on the same or next day, Britons can cover what’s owed through their online bank account, telephone banking, CHAPS, by debit or corporate credit card online or physically at a bank or building society. Those who want to pay through a bank or building society will need a paying-in slip from HMRC.
Payments will go through between three and five days if Britons elect to use BACS, Direct Debit or by cheque through the post.
Online payment services may be slow during busier periods but it is possible to check on this through the Government’s website.
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Those who have already filed their Self Assessment tax return may be able to pay the bill in instalments. What a person needs or wants to do with this depends on whether they want to make payments against their latest bill or make advance payments against their next bill.
Where Britons cannot afford to pay their latest bill, they can set up a payment plan to spread the cost of their Self Assessment bill if they owe £30,000 or less, do not have any other payment plans or debts with HMRC, are up to date with their existing tax returns and it’s been less than 60 days after the payment deadline.
Britons who utilise this option will be able to choose how much to pay straight away and how much they want to pay each month but payees will have to pay added interest.
Payment plans can be set up online or through the Payment Support Service but where taxpayers don’t keep up with their repayments, HMRC can ask them to pay everything they owe.
It’s also possible to pay a Self Assessment tax bill through a PAYE tax code and to check if these payments have arrived, people can check their online account. According to the Government, it should show as paid between three and six working days later. If paying by post, taxpayers can include a letter with their payment to ask for a receipt from HMRC.
HMRC urges action
In recent weeks, HMRC has urged affected taxpayers to take action as a Christmas Day rush and scam issues mounted. In 2020, HMRC announced over 2,700 returns were filed on Christmas Day, with hundreds attempting to file away their returns within a one hour window.
This places pressure on the service during the Christmas and winter holiday period and HMRC encouraged people to file early to avoid this. Last year, more than 10 million customers completed their return by January 31, 2021.
Myrtle Lloyd, HMRC’s Director General for Customer Services, commented: “Customers can beat the rush and send us their tax returns now. They have until the January 31 deadline to pay, which means they have longer to set up a monthly payment plan if they need one.”
HMRC was also forced to issue a warning recently as it emerged tax “trickers” are trying to steal money from unsuspecting Britons. This warning came as the Government prepared to issue reminder emails and SMS to taxpayers.
The Government warned 800,000 tax-related scams had been reported in the last year alone and as HMRC began issuing reminders, it urged customers to not be taken in by malicious emails, phone calls or texts, thinking these are genuine communications.
Ms Lloyd said: “Never let yourself be rushed. If someone contacts you saying they’re from HMRC, wanting you to urgently transfer money or give personal information, be on your guard. HMRC will also never ring up threatening arrest.
“Only criminals do that. Scams come in many forms. Some threaten immediate arrest for tax evasion, others offer a tax rebate. Contacts like these should set alarm bells ringing, so if you are in any doubt whether the email, phone call or text is genuine, you can check the ‘HMRC scams’ advice on GOV.UK and find out how to report them to us.”
HMRC explained criminals use emails, phone calls and text messages to try and dupe individuals, and often mimic Government messages to make them appear authentic. They want to trick their victims into handing over money or personal or financial information.
Taxpayers can report suspicious phone calls using a form on GOV.UK. Customers can also forward suspicious emails claiming to be from HMRC to phishing@hmrc.gov.uk and texts to 60599.
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