Filed your self-assessment late? Here’s how you could avoid penalties.

HMRC have released figures showing 745,000 people missed the deadline for filing their self-assessment return. You will be issued a £100 penalty if your return is up to 3 months late. However, you can avoid these penalties if you have a reasonable excuse.

HMRC define a reasonable excuse as ‘something that stopped you meeting a tax obligation that you took reasonable care to meet.’

Reasonable excuses include:

• A close relative died shortly before the deadline.
• Issues with mental health including depression (a doctor’s note would be required).
• IT issues for yourself or HMRC.
• Fire or flooding of your home.

However, HMRC will deal with each case individually.

HMRC have demonstrated that the following are not reasonable excuses:

• Forgetting the deadline.
• You relied on someone else to do your return and they didn’t.
• Your payment failed because you didn’t have enough money.
• You made a mistake on your return.
• You were not reminded by HMRC.

The Khan Properties case in October has the potential to nullify any automatically issued penalties as the judge suggested that ‘Only HMRC officers have the power to impose a penalty and give instructions that may be issued by a computer’. However, a spokesman from HMRC doubts that the case will set a precedent as the matter involved a company filing late not an individual.  

Aspire Comment

It is important to keep track of all HMRC deadlines whether they are for individuals or for your company to avoid penalties. If you have been issued a penalty is it always important to ask the question ‘Did I do everything reasonably possible to submit my assessment on time?’ as this is how HMRC will judge your appeal.

If you are faced with penalties and want advice on what to do next contact us at enquire@aspirepartnership.co.uk or call us on 0121 445 6178.