2021 was a whirlwind of a year. Still affected by the pandemic, many businesses have noticed a change to how they run and even what they do. Due to the tumultuous year we have yet again faced, HMRC have, for the second year in a row, postponed the usual penalty for late filing and paying of your tax return.
That’s right – just like last year, HMRC have announced that they will be giving you an extra month to submit your online Self Assessment tax return and pay any tax owed.
In a nutshell, you’ll have until the 28th February 2022 to submit your online tax return, while avoiding the usual £100 late fee that usually comes into effect on 1st February each year. This change affects all business owners, including limited companies.
But don’t stop what you’re doing just yet! It’s still the wisest option to get your return in before the 31st January 2022. This is for a few important reasons:
- The deadline for paper submissions (31st October 2021) is now long gone, so you’ll have to get online to submit your tax return. And if you have any queries for HMRC? See the next point.
- HMRC will be overwhelmed this time of year with millions of businesses submitting their tax returns. (Around half have done so already, meaning there’s about 6 million left to go.) Prepare yourself for a longer wait than usual if you need to contact them directly. In the meantime, you can contact us for helpful advice.
- You’ll pay interest on your tax balance due from 1st February 2022. This only applies if you haven’t paid your balance or arranged a payment plan prior to 31st January 2022. So, although you’ll skip the £100 late fee, there will be an extra charge on your payment. Best to avoid that if you can!
- It’s best practice to set time aside and aim for the original deadline. Not only does it get you used to those dates (so you’re less likely to be caught out next year), you’ll also be able to relax a bit more in February.
Knowing where you are with your finances is crucial to the success of your business. That’s why we always recommend staying ahead of deadlines like this. That way, you’ll never be shocked by a tax bill, and always prepared for any last-minute changes life can throw your way. Practicing good habits, particularly if you’re new to the world of business ownership, will also set you in good stead for the years and successes to come.
Need more information? Contact us today for personal advice from our friendly team.