File or fine? Royal London’s tips to avoid missing the self-assessment tax return this January

23 December 2021  
4 min read
  • Over 31,000 self-employed taxpayers submitted their HMRC Self-Assessment tax returns over Christmas Eve, Christmas Day and Boxing Day last year
  • 1.8 million people failed to file their returns by the 31st January 2021 deadline
  • Royal London offers top tips to avoid missing the deadline this January and the penalties you could face – including charges exceeding £1,000

Thousands of self-employed people submitted their HMRC Self-Assessment tax returns over the Christmas period last year, with 31,400 filing over Christmas Eve, Christmas Day and Boxing Day.

Figures from HMRC1 show that Christmas Eve was the most popular festive day for returns, with 20,200 returns; 11am – 12pm was the busiest time of the day. On Christmas Day, 2,700 tax returns were filed, with the peak time for filing between 2pm – 3pm. Meanwhile, on Boxing Day 8,500 tax returns were filed, with the peak time ranging from 3pm – 4pm. 

More than 10.7 million taxpayers submitted their tax return last year by midnight 31st January 2021, but nearly 1.8 million failed to meet this deadline2.Taxpayers who do not submit their applications in time could face the following penalties3:

  • One day late – an automatic £100 charge from HMRC, which will increase by £10 for each additional day the return is late, capped at 90 days (reaching a maximum of £1,000 including the original penalty)
  • Six months late – this can result in a fine of either £300, or 5% of the tax due (whichever is higher), alongside the possible maximum fine of £1,000 already charged for being one day late
  • Twelve months late – taxpayers will be hit by a £300 fine, or 5% of the tax due (whichever is higher), combined with the penalties above listed for a one day late submission (maximum of £1,000) and a six month late submission
  • If you’re part of a business partnership, all partners can be charged a penalty if a partnership tax return is filed late

Commenting, Sarah Pennells, consumer finance specialist said:

“It is alarming to see that such a huge number of taxpayers failed to meet the HMRC deadline last year, as the penalty fines are not cheap and can be prevented by filing before the cut off point.

“This may partly be due to the self-employed struggling once the pandemic began, with some taxpayers not making enough money to pay their returns or working flat out to keep businesses running during these tough times.

“Here are some of my top tips to help taxpayers ensure their tax returns are filed on time this year:

1. Think ahead and start early, leaving plenty of time to prepare. The option to do your tax return opens in April with the beginning of the new tax year, so try not to leave it until the last minute where you can make mistakes when rushing. Doing it early gives you more time to collect all the documents and information you need.

2. If you are not registered with HMRC for this online tax returns, you will need an activation code which can take up to 10 days to arrive.

3. If you are looking for a financial adviser to help you, get in early to book an appointment. January can be a really busy month for advisers because many people are looking for help with this, so make sure if you need advice that you find an adviser who is available with a good measure of time.

4. When you’re self-employed, tax returns are your only real way of proving how much you earn. The sooner you file your 2020/21 return, the quicker you’ll have an extra year’s worth of accounts to show, which could help you with applications for things like mortgages and other loans.

5. Sometimes people end up overpaying tax, which results in a refund being paid. The sooner you pay your 2020/21 tax bill, the sooner you’ll get your refund if you’re owed one.

6. Finally, avoid doing your returns over the Christmas period if you can. The pandemic has made it more important than ever for us to spend time with the ones we love, and there is plenty of time before Christmas to get this done. Put your feet up and enjoy the festive period!

Notes to Editors

  1. Press release from HMRC titled “2,700 tax returns sent in on Christmas Day”.
  2. Press release from HMRC titled “10.7 million tax returns filed by 31 January deadline”.
  3. Information taken from Which? article titled “Late tax returns and penalties for mistakes”.
  4. HMRC also offer the option of a paper Self-Assessment tax return, with a deadline of 31st October – the deadline to submit paper returns for tax year 2020/2021 has now passed . There are no penalties for missing the paper deadline, it means you will have to submit electronically instead.

About Royal London

Royal London is the largest mutual life insurance, pensions and investment company in the UK, with assets under management of £153 billion, 8.8 million policies in force and 4,075 employees. Figures quoted are as at 30 June 2021.

For further information please contact

Lena Nunkoo, PR Manager