HM Revenue and Customs (HMRC) has announced that it is waiving late filing and payment penalties for one month for self-assessment taxpayers.
The decision to allow more time has been made due to COVID-19 pressures and will give contractors and freelancers who are self-employed and are responsible for filing their own tax returns an extra month to complete their 2020 to 2021 tax returns and pay what they owe.
Lucy Frazer, Financial Secretary to the Treasury, said: ”We recognise that Omicron is putting people under pressure, so we are giving millions of people more breathing space to manage their tax affairs.
“Waiving late filing and payment penalties will help ease financial burdens and protect livelihoods as we navigate the months ahead.”
According to HMRC, nearly 6.5 million tax returns have already been submitted out of the 12.2 million that are due by 31 January 2022. The department is encouraging people to file their returns on time as interest is still payable from February 1st, it also “recognises the pressure faced this year by Self Assessment taxpayers and their agents.”
Angela MacDonald, HMRC’s Deputy Chief Executive and Second Permanent Secretary, said:
“We know the pressures individuals and businesses are again facing this year, due to the impacts of COVID-19. Our decision to waive penalties for one month for Self Assessment taxpayers will give them extra time to meet their obligations without worrying about receiving a penalty.”
The penalty waivers allow people to complete their tax return online by 28th February rather than 31st January and mean that they won’t receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by the 1st of April 2022.
Self-employed workers will also need to declare on their self-assessment whether they received any grants or payments from the COVID-19 support schemes before the 5th of April 2021 as these are taxable.
