How has Covid-19 affected the deadline?
Around 1.8 million taxpayers missed the 2019/20 deadline for self-assessment on 31 January 2021 due to Covid-19, according to figures published by HMRC.
The tax authority revealed 1,790,368 people failed to meet the midnight deadline, almost double last year’s total of 958,296.
HMRC have said that the spike of personal taxpayers missing this year’s deadline – about 15% of the 12.14m returns due – was due to the impact of COVID-19.
Karl Khan, interim director-general for customer services at HMRC, said officials knew that “many individuals and small firms found it harder to pay this year due to the pandemic”.
Delaying the deadline for submission–
Unlike in previous years, HMRC waived the automatic £100 penalty on late tax returns until 28 February 2021.
However, 2.6% annual interest on those late payments kicked in from 1 February 2021.
Jim Harra, chief executive at HMRC, added:
“Not charging late-filing penalties for late online tax returns submitted in February gave the breathing space required to complete and file tax returns, without customers worrying about receiving a penalty.
“We reasonably assumed most of these people had a valid reason for filing late, caused by the pandemic.”
HMRC had urged non-filers to pay any tax owed, or an estimated amount of tax, for 2019/20 by 31 January 2021 to minimize any interest and penalties.
The time-to-pay service enables taxpayers to arrange payment plans, spreading the cost of paying their 2019/20 tax bill in up to 12 monthly instalments.
However, the tax authority said these payment plans need to be set up before 1 April 2021 to avoid a 5% late-payment penalty.
Payment plans arranged after this date will incur this penalty as well as accruing interest.
Exactly 10,743,387 people filed their 2019/20 self-assessment tax returns on time – down from a record high of 11,122,967 submissions last year.