Good news for self-employed individuals! If you paid your self-assessment bill on time – at the end of last month – you can still file your form this month. Plus, HMRC will waive the usual £100 late penalty fee as long as you file it online by 28th February.
This does not constitute advice and advice should be sought in all instances before acting on it. The Financial Conduct Authority does not regulate tax advice.
The government made the decision after being pressured by accounting groups across the nation to do the right thing, but are still being criticised for not waiving penalties for late tax payments as well.
After recognising that many people would have trouble filing returns on time, HMRC decided to not charge late filing penalties to allow taxpayers some breathing room. With the world as hectic as it is, even just the one month extension will surely be a huge help for some.
What’s the criteria?
To prevent further “complicating” matters, in order to take advantage of this grace period, you will have needed to pay your bill on time and you will still be charged interest as of 1st February for any debts owed.
Other options were on the table such as ability to spread payments over the course of 12 months as long as your bill was under £30,000 and once again, your return was filed on time.
Could more be done to support businesses?
Most in the financial community support the decision that allows flexibility for individuals and businesses in these trying times, but argue there is still more that could have been done.
After the devastation of 2020 and the scores of individuals, who for one reason or another missed out on government assistance throughout the year like the SEISS, any help from HMRC would be most welcome.
Self-employed people’s stress could be eased even further if late payment penalties on tax owed to the government are waived, which would let freelancers pay back the money they own in installments without worrying about additional fines or fees.
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