To all those self-assessors out there – it’s a bit of a pain isn’t it, filling out HMRC’s forms?
I know that when you’re trying to get your business off the ground sometimes the last thing you want to worry about is the paperwork.
But when it comes to tax, it’s crucial that we comply with the taxman’s requirements.
As a company director, I am required to complete a tax return, as are the self-employed, trustees and those receiving foreign income.
Last week, HMRC announced around half a million people were being sent notices of penalties of at least £1,200 for failing to submit their self-assessment tax returns for 2010/11.
The penalty is made up of £900 in daily fines alongside a late-filing penalty of £300, or five per cent of the tax due.
Anyone who now ignores their self-assessment filing obligations will be liable to higher penalties than in previous years under changes to the taxman’s levy structure.
“Despite several reminders, nearly six per cent of people have not sent their 2010/11 tax returns to us and they’ll be getting a penalty,” said HMRC’s director general for personal tax, Stephen Banyard.
So my advice: start planning early for your self-assessment tax return. It pays in the long run.