Have you ever missed your tax return deadline?
If so, new research has found that you’re not alone. Large numbers of small and medium sized businesses miss important payment and tax return submission deadlines every year whilst many other businesses are missing out on beneficial tax breaks and grants.
One in ten businesses have missed the tax return deadline
The recent survey from Yorkshire and Clydesdale Banks of 500 small businesses found that one in ten owners admitted to missing vital tax payments or tax return deadlines whilst almost one in five confessed to losing out on tax breaks and grants.
19 per cent of small business owners questioned had not taken advantage of tax advantages open to them whilst 10 per cent admitted to missing the deadline for their tax return or making late Value Added Tax (VAT) payments.
And, it seems that one of the major problems is that small business owners simply do not know where to turn for advice and guidance. The research found that 15 per cent of people struggled to understand new tax rules whilst 16 per cent did not know who to ask for advice on regulation.
Gary Lumby, director of small business banking at Clydesdale and Yorkshire Banks, said: “For small businesses, every penny really does count, so the cost of falling foul of red tape can make a fundamental difference to their ability to succeed.
“In extreme cases, not understanding red tape could lead to them closing. It is worrying that a significant number of small firms do not know where to turn for advice on these matters and we hope to change that for our customers.”
Tax return deadlines
There are two deadlines for submitting a self assessment tax return depending on whether you use a paper based return or an online return.
All paper returns have to be received by HM Revenue and Customs (HMRC) by midnight on 31 October following the end of the tax year. Online tax returns must reach HMRC by midnight on 31 January.
If you miss the deadline, you will face penalties. If your tax return is just one day late you will pay a fixed penalty of £100. If it is three months late, you will pay £10 for each following day up to a maximum of £900. The penalties then increase if your return is 6 or 12 months late.