HMRC has informed Chartered Accountants Ireland that late filing and late payment penalties are waived for one month for Self-Assessment taxpayers filing their 2020/21 returns. The Institute made representations to HMRC before Christmas and earlier this week highlighting the health and safety risks facing accountants and taxpayers in meeting the 31 January deadline in wake of worsening COVID-19 case numbers. The deadline to file and pay remains 31 January 2022 but those who cannot file their return by the deadline will not receive a late filing penalty if they file online by 28 February and they will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by 1 April. Interest on late payment of tax, however, will apply from 1 February, as usual.
On publishing news of the penalty waivers, 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.”
HMRC noted that, of the 12.2 million taxpayers due to submit their tax return by 31 January 2022, almost 6.5 million have already done so.
HMRC told Chartered Accountants Ireland that Time to Pay options are still available to assist taxpayers. Once they have filed their 2020/21 tax return, taxpayers can set up an online payment plan to spread Self-Assessment bills of up to £30,000 over 12 monthly instalments. HMRC noted that if taxpayers still cannot file by 28 February or pay (or set up a payment plan) by 1 April, the usual right of appeal against any penalty will be available, with COVID-19 as a possible reasonable excuse.
See HMRC’s press release for further details.
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