If you have already completed your 2012 tax return, then you don’t need to read this article and you can give yourself a pat on the back.
If you have still to file your tax return, then please read on. You need to act quickly to avoid having to pay the following penalties. There are only four months left to complete your tax return.
The filing date for the 2012 tax return is 31 January 2013. If the return is late, penalties will apply as follows:
• an initial £100 fixed penalty – even if no tax is due or all the tax is paid on time
• after 3 months, daily penalties of £10 per day, up to a maximum of £900
• after 6 months, a further penalty of 5% of the tax due or £300, whichever is greater
• after 12 months, another 5% or £300 charge, whichever is greater. In serious cases, the penalty after 12 months can be up to 100% of the tax due.
This means that if you do not send in your 2012 tax return until 30 September 2013, you will have penalties to pay of £1,300 even if no tax is payable.
Many late filers for 2011 have recently been sent large unwelcome penalty notices.
New penalties also apply for paying late. These are 5% of the tax unpaid at:
• 30 days
• 6 months, and
• 12 months
Interest is charged in addition to these penalties.
The big advantage of doing your tax return now is that you will know how much tax to pay well before the next tax payment date of 31 January 2013.
You may even be due a tax refund and the earlier you claim this amount the earlier the refund can be made.