Q: I could not complete my 2016/17 self-assessment tax return on time. I am concerned about the consequences of this and want to know what the implications are?

 

A:Where a 2016/17 self-assessment tax return has not been filed by 31 January 2018, you will already have been charged a £100 penalty.Online returns with a 31 January 2018 filing date will incur additional penalties from 1 May 2018.  Penalties of £10 per day will be chargeable for up to 90 days.

If a 2016/17 tax return has still not been filed by 31 July 2018, the initial penalty of £100 and the daily penalties chargeable will amount to a total of £1000 and in addition, a further penalty of at least £300 becomes chargeable.

These automatic penalties take no account of the amount of tax an individual owes.  Even if you owe no tax at all or are a due a refund the penalties still apply.

If an individual believes they do not need to be in self-assessment, if for example, they are within the PAYE system or because they have become non-resident they can ask HMRC to withdraw the notice to file a return.  Such an application must be made within two years of the end of the tax year to which the return relates.

If a return cannot be cancelled, the late filing penalties can be appealed if there is a reasonable excuse for late filing.  Examples are prolonged ill-health or bereavement.

Where someone has failed to register for self-assessment for 2016/17 specific rules apply where there is a failure to notify.  Penalties are based on the amount of tax lost as a result of the failure to notify an increase if a deliberate behaviour is involved.

 

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