It is important for any small business owner to remember that new late filing penalties have been brought into effect by HMRC in April 2011. Anyone who does not file their self-assessment tax forms on time will be subject to these penalties, which increase in scale depending on how long you delay filing or paying them.
If you only file one day late, you will be charged a £100 penalty even if you have no tax to pay or have already paid the tax you owe. A delay of three months will mean an automatic daily penalty of £10 per day (up to a maximum of £900). Further penalties apply at six months (5% of tax due or £300, whichever is greater) and the same again at twelve months. Very serious cases may face penalties of up to 100% of the tax due.
There are separate penalties for late payment. You are allowed up to thirty days after the due date without a penalty, but then you will be charged an initial penalty of 5% of the tax unpaid at that date. After six months, you will be charged a further 5% of the tax unpaid and an additional 5% of unpaid tax at twelve months. Don’t forget that these penalties are in addition to the interest you will be charged on unpaid amounts and penalties.
The deadlines for paper filing are Monday October 31st and January 31st for filing online. It is vital that you keep these dates in the forefront of your mind to avoid these crippling penalties from killing your business.
If you need help with your taxes, Yorkshire Accountancy want to help! Get in touch with us today to discuss your requirements.