Under self assessment an individual is responsible for ensuring that their tax liability is calculated and any tax owed is paid on time.
Tax returns are required to be filed by everyone for whom HMRC are aware need a return including all those who are self employed or company directors. You will be sent a notice advising that a tax return is due, but not the tax return itself - this must be filed online.
If any taxpayer is not issued with a tax return but has tax due they should notify HMRC who may then issue a return.
A taxpayer is required to file their tax return by 31 January following the end of the fiscal year.
Late filing penalties apply for personal tax returns as follows:
- £100* penalty immediately after the due date for filing (even if there is no tax to pay or the tax due has already been paid)
- over 3 months late – a £10 daily penalty up to a maximum of £900
- over 6 months late – an additional £300 or 5% of the tax due if higher
- over 12 months late – a further £300 or a further 5% of the tax due if higher. In particularly serious cases there is a penalty of up to 100% of the tax due
Corrections or amendments
HMRC may correct a self assessment within nine months of the return being filed in order to correct any obvious errors or mistakes in the return.
An individual may, by notice to HMRC, amend their self assessment at any time within 12 months of the filing date.
HMRC may enquire into any return by giving written notice.
In most cases the time limit for HMRC is within 12 months following the filing date.
If HMRC does not enquire into a return, it will be final and conclusive unless the taxpayer makes an overpayment relief claim or HMRC makes a discovery.
It should be emphasised that HMRC cannot query any entry on a tax return without starting an enquiry. The main purpose of an enquiry is to identify any errors on, or omissions from, a tax return which result in an understatement of tax due. Please note however that the opening of an enquiry does not necessarily mean that a return is incorrect.