HMRC has revealed that a record 11.5 million tax returns for the 2022/23 tax year were filed by the midnight 31st January deadline. However, an estimated 1.1 million individuals found themselves on the other side of the deadline. If you're among those who missed the crucial January 31st cutoff, don't panic - this article is tailored to guide you through the intricacies of late filing, shedding light on the penalties you may face and providing invaluable insights on the necessary steps to rectify the situation. So, whether you're a seasoned taxpayer or a first-time filer, read on to navigate the aftermath of a late tax return
I missed the tax deadline – what should I do now?
If you missed the deadline, to achieve the minimum penance possible you need to file your tax return and pay your tax bill as soon as possible. Remember that sometimes a late tax return is better than a rushed and incorrect one.
1. Calculate your crypto tax
Most likely, you’ll be liable for capital gains tax on profits from selling or trading your cryptocurrency, income taxes can also apply for activities like mining and rewards from staking. Our comprehensive UK crypto tax guide offers detailed insights.
Calculating your crypto tax requires accurate transaction records. You'll need to determine the value of your crypto assets as of the date you acquired them and the date you sold or traded them.
If you're unsure you can simplify the process with a crypto tax calculator like Recap. Our software captures your transactions, automates valuations, tax calculations and generates a detailed tax report with everything you need to file.
2. File your tax return via the Government Gateway
The easiest way to file your taxes with HMRC is online - simply sign in to the Government Gateway. To make the process quicker, gather everything you will need to hand, including your unique taxpayer reference (UTR).
You'll need to be registered for self assessment and have your UTR and activation code to complete your tax return. You can register here. As HMRC use post you may have to wait up to 10 days before you can log in and file.
Carefully fill in your tax return. Use your Recap tax report to file your capital gains on form SA108 and any income on SA100. For more detail head to our blog, How to file your crypto taxes with HMRC.
3. Pay your tax bill
HMRC simplifies the tax payment process with three accessible options:
- Online - you can pay your taxes by debit or credit card.
- Bank transfer - using online or telephone banking. It usually takes up to 3 working days for your payment to reach HMRC.
- Cheque - you can send a cheque by post. Ensure you fill it in correctly and write your 14-digit capital gains reference number (starting with X) on the back.
If you’re concerned about the tax due, you may be able to set up a Budget Payment Plan by logging into your Government Gateway account or by contacting HMRC’s Payment Support Service. We recommend contacting them as soon as possible to avoid further penalties and unnecessary stress.
What are the penalties from HMRC for filing my tax return late?
There are different costs, penalties are dependent on how late you file…
- File up to 3 months late: you’ll get a fixed penalty of £100
- More than 3 months late: you’ll be charged £10 a day (up to £900)
- After six months: HMRC will fine you £300, or charge 5% of the tax you owe, whichever is larger.
- After 12 months: another 5% of the tax due or £300, whichever is greater.
You will also be penalised for paying late and face interest on the tax that you owe. You can use HMRC’s online calculator to estimate how much your penalty may be.
Can I appeal a HMRC penalty for late filing?
Anyone with a legitimate excuse for missing the tax deadline can talk to HMRC to avoid fines. Those with genuine excuses will be treated leniently as HMRC try to focus penalties on repeat offenders and tax evaders, however they may ask you to provide evidence to prove your case.
What’s a valid excuse for missing the self assessment tax return deadline?
Below are some of the reasonable excuses HMRC may accept; normally unexpected events that fall out of your control and occur close to the deadline preventing you from filing your tax return.
Legitimate excuses for appealing a HMRC tax penalty:
- A serious or life-threatening illness
- Delays related to a disability or mental illness
- An unexpected hospital stay
- The death of a partner or close family memberFire, flood or theft
- Computer or software failure
- Issues with HMRC’s online services
- Postal delays that you could not have predicted
- You were unaware or misunderstood your obligation
- Your authorised agent did not send your tax return.
HMRC has published interactive guidance to explain the process.
How do I appeal a tax penalty from HMRC?
You can appeal online through a Government Gateway account or by post using form SA370 (or a letter) but only after you have filed your tax return (or informed HMRC that you didn’t need to file). Each appeal is dealt with on a case by case basis.
- the date the penalty was issued
- the date you filed your Self Assessment tax return
- details of your reasonable excuse for late filing
I submitted my tax return to HMRC on time but made an error - what can I do?
You can resubmit your tax return "Corrections" before the next deadline but you must inform HMRC of the change. You may be penalised if found to have submitted incorrect information whether it was done deliberately or through accidental carelessness.
How can I be more prepared for next years tax deadline?
Most of us only start thinking about taxes when it's time to file. Because the UK tax year ends in April and starts in January, waiting until tax season means its too late to do anything about it. If you plan ahead you can ease your worries and potentially reduce your tax bill!
As well as helping you to declare for the filing tax year you can also view the active tax year. This understanding of your current gain and tax liability allows you to make the most of your allowances and optimise your taxes before year end.
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