The Law of Decreasing Returns
There has been an increase in the number of people who failed to submit a tax return for 2013/14 when they should have done. HMRC received 10.24 million tax returns by midnight on 31 January. Around £0.9m people have yet to file their SATR’s, that’s nearly 10% of all those who should be doing one! If you know anyone who hasn’t done one, let them know that Sapphire can help! Missing the tax return deadline results in an automatic £100 late-filing penalty. There are further late-filing penalties after 3, 6 and 12 months. People with a genuine reason for not filing should contact HMRC to ensure they do not incur more penalties.
Why have more people missed the deadline for 2013/14?
Blame for an increasing number of late tax returns is being partly attributed to those who should be paying extra tax to claw back some of their child benefit. The rules for this are so tricky that thousands of parents aren’t aware they should be paying it, let alone taking the initiative and telling HMRC that they need to fill in a self-assessment form.
If you have overlooked the so-called high income child benefit charge (HICBC) and so not submitted a tax return, you will have incurred a fine of £100. But by notifying HMRC now and paying any tax due you can avoid, or at least minimise, other penalties. The sooner you act the more sympathetic HMRC is likely to be.
Did you forget to mention that you received Child Benefit and earning over £50,000?
On the other hand, if you submitted a tax return but missed reporting the HICBC, simply amend your return and pay any additional tax before 1 March 2015 and no penalty will apply, although you will have to pay a tiny amount of interest.
Thousands of taxpayers have overlooked the high income child benefit charge and so failed to tell HMRC that they need to complete a self-assessment tax return. If that’s you, tell HMRC without delay and pay the tax due. This will minimise the penalty you might be charged.