Tax return warning as deadline looms to file Self Assessment and avoid hefty fine | Personal Finance | Finance

A person’s Self Assessment is a vital document to ensure they are charged the correct amount of . Individuals and businesses need to complete the form if they have income other than from wages, pensions and savings.

The deadline to file a Self Assessment tax return is January 31, with an automatic penalty of £100 for those who miss the deadline, as well as other costs for late payment.

An article published on the Government website on January 3 said some 5.7 million Britons still needed to file their Self Assessment.

Who has to send a Self Assessment tax return?

A person will need to file a tax return if during the last tax year, from April 6, 2022 to April 5, 2023, they were:

  • Self-employed as a ‘sole trader’ and earned more than £1,000 (before deductions for tax relief)
  • A partner in a business partnership
  • Earned £100,000 or more.


An individual may also need to file a Self Assessment if they have any untaxed income. This could include:

  • Some COVID-19 grant or support payments
  • Income from renting out a property
  • Tips and commission
  • Income from savings, investments and dividends
  • Foreign income.


Another cost for those who do not file their tax return on time is a late payment interest rate. This is set at the base , plus 2.5 percent, meaning the rate is now six percent.

For example, a taxpayer who owes £30,000 on January 31, 2023, but who does not pay the tax and late payment penalty until June 1, 2023, would find their total bill had increased by just over £2,100.

With the rise in the base interest rate, they would be paying just under £300 more interest to HMRC than the same tax debt paid late in 2022 would have cost them.

Dawn Register, head of tax dispute resolution at accountancy firm BDO, said: “Taxpayers who file and pay late this year may be in for a shock.

“In addition to late filing penalties and late payment penalties, which can quickly add up, the interest rate applied by HMRC for late payment is at its highest level in almost a decade and a half.”

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