Don’t Miss the Self-assessment Deadline
Business owners due to make a tax payment on account risk penalties if they miss the 31 July deadline, the Association of Chartered Certified Accountants (ACCA) has warned.
The deadline affects around nine million taxpayers in the UK who complete a self-assessment tax form, many of whom are due to make a forward payment as part of next year’s bill. Unlike the January deadline, which gives taxpayers a month’s grace before surcharges are added, there is no similar period in July.
Based on the amount of tax paid the previous year, the payment will normally be equal to half of the previous year’s tax bill. So a business that paid £10,000 tax in 2007/08 would have owed £5,000 at 31st January and the same amount by 31stJuly.
Chas Roy-Chowdhury, head of taxation at ACCA, said that those that miss the payment will be liable for a 5% surcharge on any tax overdue, plus 2.5% interest per year.
However, he urged those businesses struggling to pay their bill to get in touch with HMRC, as the Revenue would allow taxpayers genuinely in difficulty to defer payment.
“The key is not to ignore the issue, or miss the deadline. If you defer, you will still be charged interest on the balance, but any approved HMRC deferment will not incur any additional penalties.”
Business owners with reduced workloads who believe their tax liability will be lower for 2008/2009 should also contact HMRC, as they will be entitled to adjust their payment, Roy-Chowdhury added.
Business owners should obtain form SA303 from their local tax office or those that fill in online tax returns can adjust the amount online.
“Explain that your circumstances have changed, and as such, you will be making a smaller payment on account this July as you expect your tax liability to be lower.”
Contact the HMRC helpline 0845 366 1204 for further information, or go to www.hmrc.gov.uk