Our tax experts warn of tax penalties

As a leading firm of chartered accountants and tax advisers we are warning individuals who have not yet filed their 2014/15 Tax Return that they may be at risk of substantial penalties.

One of our senior tax managers, Lee Watson, said: “It is normally the case that a Tax Return must be filed by 31 January after the end of the tax year (in the case of 2014/15 by 31 January 2016). Where this deadline is not met, HM Revenue & Customs (HMRC) issue an automatic penalty of £100 in February.”

Lee continued: “However, further penalties begin to accrue where the Return is not filed by 1 May at a rate of £10 per day. Therefore a 2014/15 Tax Return filed on 31 May 2016 may lead to an individual paying daily penalties of £310 in addition to the initial £100 late filing penalty. The daily penalty charge continues until the earliest of the Tax Return being filed or 31 July. Further penalties are then charged where the Return is filed post 31 July.”

Lee added: “Figures released by HMRC suggested that 870,000 people did not file their Tax Return by 31 January 2016, raising £87m in penalties for HMRC. Whilst some of these penalties may be subject to appeals by taxpayers, there is still likely to be a sizeable figure unnecessarily paid over to HMRC in late filing penalties. If any of those individuals have still not filed their 2014/15 Tax Return by 31 July 2016, it is likely that another sizeable sum will be paid over to HMRC by taxpayers. Our advice would be to seek assistance to file the outstanding Return as soon as possible.”