Almost 700,000 taxpayers missed the online Self Assessment deadline, new figures have revealed.
The Institute of Chartered Accountants in England and Wales (ICAEW), who published the report, said taxpayers should complete their tax return as soon as possible to avoid their penalty increasing.
However, it added that there are circumstances in which you might be able to query an “unfair penalty” with HM Revenue & Customs (HMRC).
According to the regulator’s report, the figure represents around six per cent of all self-employed business owners, indicating a record number of penalties.
Missing the Self Assessment deadline, even by minutes, attracts an automatic £100 penalty fine. After three months, the penalty will grow dramatically, even if you have no tax to pay.
Commenting on the report, Anita Monteith, ICAEW Technical Tax Manager, explains that HMRC can make allowances for genuine excuses.
“HMRC is not very forgiving when it comes to taxpayers missing the deadline, however, if you think you shouldn’t have needed to file a tax return at all, call HMRC and explain why you think this is the case,” she said.
Reasonable and genuine excuses, she says, may include an unforeseeable illness or having no other income than that paid under PAYE.
“If you believe you had a reasonable excuse for missing the deadline, you should make HMRC aware of this by making an appeal against the penalty, but the reason must continue between the filing deadline and shortly before you actually file the return.
“So if you have flu and had been putting it off until 31 January then were too ill to file on time, as soon as you are better, you have to complete and file your return ASAP or the penalty won’t be cancelled.”
Ms Monteith added: “HMRC generally takes a narrow view on what is a reasonable excuse and will not consider an appeal until the return has been filed.”
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