HMRC charges late taxpayers a penalty of ten pounds per day

If you haven't paid your 2023–2024 tax bill yet, you could be subject to additional penalties of £10 per day since you are now three months past due

Your 2023 - 2024 tax return and bill payment were due on January 31, 2025. According to HMRC, 1 million taxpayers are thought to have missed the deadline this year.

A tax return is not necessary for everyone, but if you failed to submit it by the deadline and HMRC was expecting one from you, you are now three months behind schedule. At this stage, the penalties begin to increase, so you should organize your documentation as soon as you can.

The first penalty for late filers is 100 if they are even one day late (i.e. e. February 1st. You are subject to further daily penalties of 10 up to 900 after three months (1 May).

Following six months, there is an additional penalty of either 300 or 5% of the tax owed, whichever is higher. Once you are 12 months past due, you will be subject to the same penalty (5 percent or 300).

Even if you filed on time, there are still penalties for paying your bill after the due date. Five percent of the outstanding tax at thirty, six, and twelve months is one of these. Additionally, interest is charged at a startling rate of 8 percent (base rate plus 4 percent).

"Hundreds of thousands of people probably still haven't filed their tax returns, even though the deadline was back in January," stated Alastair Douglas, CEO of financial services firm TotallyMoney.

Even though the initial 100 fine might not have been sufficient to motivate some people to start, HMRC will now begin charging late filers an additional 10 per day.

According to Douglas, any penalties must be paid within 30 days of being notified of them. Payment options include sending a check, using a debit or credit card, or transferring funds via bank transfer.

You can contest your penalty if you have a valid reason for the late filing of your tax return. This can involve a death or severe illness in the family, or issues with the online services provided by HMRC.

Because they are unable to pay their taxes, some people also put off handling their paperwork, but this is a bad idea.

"If you're having trouble paying your bill in full, you may be able to set up a payment plan under a Time to Pay arrangement on the HMRC website," Douglas advised.

A self-assessment tax return must be filed by whom?

You most likely do not need to file a tax return if your salary is your only source of income and you are not self-employed. Through a procedure known as "pay as you earn" (PAYE), your income tax will be subtracted from your paycheck prior to its delivery.

If your pension income exceeds your personal allowance, it is typically also subject to PAYE taxes.

You will probably have to file a tax return, though, if you also receive income from investments and savings that are not held in an ISA, a business, a second residence, or another source. This also holds true if you work for yourself.

In recent years, the effects of fiscal drag have led to an increase in the number of people who are drawn into the self-assessment net. This is because, despite high inflation, tax thresholds have stayed unchanged. The tax-free allowances are therefore now worth less in actual currency than they were before.

The capital gains and dividend allowances are among the allowances that have even been reduced. This implies that before a tax bill is due, investors can accumulate less in tax-free income and gains.

It's worth getting acquainted with the regulations because a common excuse for avoiding the tax collector is simply not realizing that taxes were due. We examine who qualifies in greater detail in our tax return filing guide.

You can check using HMRC's online tool as well.

When is the due date for the self-assessment?

There are two deadlines for self-assessment tax returns in the UK.

Paper tax return deadline: October 31; online tax return deadline: January 31; if you miss the paper deadline, you can file online. HMRC must receive the forms by midnight on the due date. By January 31st, HMRC must also receive payment for any taxes that are due.