More than one million people missed the self assessment deadlineby
HMRC confirmed it received more than 11 million tax returns before the self assessment deadline window slammed shut, but with 12.1 million due to be filed, self assessment season is not over for everyone.
In a press release, HMRC said it had received 11,027,962 self assessment tax returns, not including voluntary returns and late registrations. As 12,187,811 were expected to file before the 31 January deadline, the figures indicate that more than 1.1 million people missed the deadline -- a 10% increase on the estimated 1 million people who missed it last year.
Despite its estimate of late filers, HMRC reported it received 500,000 more returns than it expected before the deadline. This could indicate that hundreds of thousands of people have been pulled into the self assessment for the first time by fiscal drag (rising wages and frozen person tax thresholds leading to taxpayers having to pay the High Income Child Benefit Charge, or pushed past the £100,000 income limit requiring them to file a return).
Late filers could face an automatic fixed late filing penalty of £100, which applies even if no tax is due or if the tax has been paid on time. Myrtle Lloyd, HMRC’s director general for customer services thanked the millions of self assessment taxpayers and agents who met the deadline. "Anyone who has yet to file and is concerned that they cannot pay in full may be able to spread the cost of what they owe with a payment plan,” she added.
Deadline day action
As with previous years, HMRC saw an influx of last-minute taxpayers scrambling to file their tax returns on deadline day. This year 778,068 taxpayers filed on 31 January, with 32,958 customers leaving it to the final hour.
HMRC also revealed that during the peak hours on the final day, between 4pm and 4.59pm, 61,549 taxpayers submitted their self assessment return.
Accountants took to Any Answers throughout self assessment season to discuss their experiences with acquiring new clients, managing the late ones and handling difficult situations.
AccountingWEB regular, ireallyshouldknowthisbut shared a message they received at 2.45pm on deadline day asking them to complete their tax returns. They commented, ‘there’s always one’ but with HMRC’s figures being released, it seems ireallyshouldknowthisbut might not have been the only one to experience this.
Dawn Register, head of tax dispute resolution at BDO said, “The higher number of people being required to file a tax return for the 22-23 tax year is likely to have led to a rise in the numbers of people filing late. We would encourage HMRC to do more to support people to be compliant and get their tax right first time.”
HMRC’s lack of support
To no one’s surprise, HMRC’s wait times continued to cause upset as many commented on a lack of support from the tax authority during self assessment season.
With HMRC placing restrictions on its helplines at the beginning of December, accountants struggled to get through to the agent dedicated line and therefore faced challenges in resolving more complex issues.
Risk of penalties
For those who will be unable to appeal the late penalties, they may be caught out by more than just a £100 fine.
HMRC said that a 5% penalty applies to unpaid tax at 30 days, 6 months, and 12 months, with interest also charged on late tax payments.
Late payment interest charges have reached their highest level in 16 years, currently standing at 7.75%, marking the highest rate since January 2008. The last-minute filers must promptly submit their tax returns to ensure they only incur a £100 penalty.