Self-Assessment – last minute tips

The deadline for filing your 2021/22 self-assessment tax return and paying any tax due is midnight on 31 January. To avoid penalties, ensure you have all your records ready, including P60s, interest statements, and dividend vouchers.

If you cannot pay your tax bill in full, it is essential to contact HMRC as soon as possible to arrange a 'Time to Pay' agreement. Filing on time, even if you can't pay immediately, will help you avoid the most significant penalties.

Common mistakes to avoid

When rushing to meet the deadline, mistakes are common. Ensure you have declared all sources of income, including small amounts of interest, casual earnings, or property income. Do not forget to claim all allowable expenses, but ensure you have the receipts to back them up. Also, remember to include any charitable donations made under Gift Aid, as these can extend your basic rate tax band and reduce your overall liability.

Payments on account

Remember that the 31 January deadline is not just for paying the balance of tax due for the previous year; it is also the deadline for making your first 'payment on account' for the current tax year. This is typically half of your previous year's tax bill. If your income has dropped significantly this year, you can ask HMRC to reduce your payments on account, but you must have a reasonable justification for doing so.

Penalties for late filing

If you miss the deadline, you will face an immediate £100 penalty, even if you have no tax to pay or have paid the tax you owe on time. If the return is more than three months late, daily penalties of £10 will apply, up to a maximum of £900. Further penalties apply at six and twelve months. It is always better to file an estimated return on time and amend it later than to miss the deadline entirely.