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It’s time for the dreaded tax return as the January 31 deadline approaches – here’s what you need to know
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With the Christmas and New Year festivities behind us, now is a great time to sit down at the kitchen table and tackle your income tax return.
If you fail to meet the 31 January deadline, you will be fined £100 and interest at 6 per cent on any tax owed.
Nearly half of the 12 million people required to file returns for the tax year ending April 5, 2022, have yet to do so.
The ‘Time to pay’ scheme allows you to spread the tax due over 12 monthly installments
Late filers and payers will be hit with further penalties if they delay until March, equivalent to 5 percent of tax due.
Sarah Coles, personal finance analyst at asset manager Hargreaves Lansdown, says the 5 per cent penalty can be avoided by agreeing a ‘time to pay’ arrangement with HM Revenue & Customs.
This allows a person to spread the tax due over 12 monthly installments with a maximum of € 30,000.
Coles adds: ‘If you prefer to file tax returns on paper, you’re already too late – the deadline was October 31. If this is your first time filing online, you will need to register for a ten-digit unique taxpayer reference code – and this can take ten business days to arrive.” The code can be ordered via Gov.uk.
Those who bury their heads in the sand are warned that the tax authorities will not pursue them.
On May 1, you’ll have to pay an additional fine of £10 per day which can be imposed for up to 90 days – so another £900 – if you still haven’t filed your tax return. #
Additional fines will be imposed six months and one year after the original January 31 deadline.
If you are not sure whether you need to file a tax return, please contact the Tax and Customs Administration on 0300 200 3310 or go to gov.uk/contact-hmrc and go to the self-assessment link.