If you submit your tax return on paper, the deadline for receipt of your return is looming. Paper based tax returns have to be with HM Revenue and Customs (HMRC) by 31st October or you could face heavy fines and penalties.
With around one in five self assessment taxpayers sending a paper based tax return, it’s important that you understand the importance of the deadline and the consequences if you miss it. Our guide explains all.
What happens if you don’t meet the 31st October tax deadline
The Financial Times reports that ‘an estimated 2m people out of the 10m who file in a tax return must meet the October 31 deadline because they submit their return on paper’.
If your paper return arrives after 31st October, you could face a £100 fine. Anita Monteith, tax faculty manager at ICAEW, the accountancy body, said: “Under strict new rules introduced last year, if your tax return is late, you’ll have to pay a fixed penalty, even if you have no tax to pay. What’s more, you will be hit with further interest charges if you fail to pay what you do owe on time.”
If you are worried that you won’t get your paper tax return in on time, you do have another option. You can choose to use HMRC’s web-based service and send your return online by January 31st instead.
However, Andrew Penman, head of PKF’s London private clients practice, says if you miss the October 31 deadline, or are concerned that you’re not going to make it in time, “it is usually better not to send a paper tax return at all and instead submit your return online by the end of January”.
He adds: “Don’t be tempted to send in a paper return late. Once a paper return has been submitted, it will be regarded as your return for the year and any subsequent electronic return you make for that year will be treated as an amendment to the original paper return.”
So, if you don’t think you will meet the 31st October deadline, you may decide to submit your return online instead. Keep reading to learn more about how to do this.
What to do if you decide to file online instead of sending a paper tax return
If you have submitted your tax return online in previous years then you will already have a user identification code for the HMRC system that you can use this time. However, if this is your first time filing online then you will have to go to the HMRC website and register.
It is wise to register for the online system early as it can take a week or two to receive your registration details for the HMRC website.
And, while the deadline is 31st January 2013, it is often advisable not to leave your tax return to the last minute. The Daily Telegraph reports that in 2011, ‘around 572,455 people left it until the last day to submit their form and avoid a £100 fine, making January 31 the busiest day of the year for using the online system.’