Don't be one of the 5.4m Taxpayers left to file their Tax Returns

That's One Way to Spend Christmas and New Year!

As we welcome 2025, there are still 5.4m taxpayers who have yet to file their 2023/24 self assessment returns, compared to 5.7m who were yet to file at the start of 2024. 

This year, 300,000 more people have ticked this task off their to-do list before entering the New Year, with many opting to submit their return during the Christmas break. 

However, the clock is ticking for those who still need to file, as the 31 January deadline approaches. Despite the festive filers, millions remain at risk of leaving it until the last minute. 

Getting ahead during Christmas

More taxpayers wanted to get their self assessment done and dusted before heading into 2025, with many using the week during Christmas to get organised. 

HMRC has reported that 40,072 tax returns were filed over Christmas Eve, Christmas Day and Boxing Day – 14,303 more than the same period last year.

This increase can be down to Christmas Eve falling on a weekday. With many choosing work over last-minute shopping, 23,731 tax returns were filed on 24 December, compared to just 8,876 filed the previous year. More people were therefore able to enjoy the festivities without tax looming over their Christmas dinners. 

On Christmas Day itself, 4,409 returns were submitted followed by 11,932 filed on Boxing Day. 

A strong finish to the year

Taxpayers clearly felt more organised this year, with New Year's Eve and New Year's Day seeing more returns filed than the year before.

HMRC revealed that 38,000 had squeezed theirs in before the bells rang on 31 December, which was 12,407 more returns filed than last year. A total of 310 submitted their return in the nick of time, filing between 23:00 and 23:59.

Our advice

Understanding and adhering to Self Assessment deadlines is essential for UK taxpayers. The penalties for late filing and payment can be significant, but with proper planning and awareness, they can be easily avoided. Taxpayers are encouraged to act promptly and seek assistance if needed to ensure compliance with HMRC regulations.

Penalties for Late Filing

HMRC imposes penalties for late filing as follows:

1. Initial Penalty (£100):

   • This applies immediately if your tax return is filed even one day late. It applies whether or not you owe any tax.

2. Daily Penalties (£10 per day):

   • If your return is over three months late, you will be charged an additional £10 per day for up to 90 days, resulting in a maximum of £900 in daily penalties.

3. Six-Month Penalty (£300 or 5% of the tax due):

   • After six months, you will face an additional penalty of £300 or 5% of the tax owed, whichever is greater.

4. Twelve-Month Penalty (£300 or 5% of the tax due):

   • At twelve months late, the same penalty as the six-month mark applies. However, in serious cases, the penalty can rise to 100% of the tax due.

In addition to penalties, interest is charged daily on any outstanding amounts, including unpaid tax and penalties.

Avoiding Penalties

To avoid penalties, taxpayers should:

1. File Early:

   • Avoid last-minute submissions to prevent technical glitches or errors.

2. Set Reminders:

   • Use calendar alerts or HMRC’s email reminders to stay on top of deadlines.

3. Seek Professional Help:

   • Engage an accountant or tax advisor to ensure accuracy and timely filing.

For peace of mind and a stress-free festive period, why not engage your friendly, local, Visionary Accountants in St Albans to undertake your next tax return?  It's a small investment to ensure your tax is accurate, compliant and on time especially when you compare it to the stress and potential costs of doing it yourself!