HMRC to waive late filing penalties for self-assessment

With the pandemic creating financial difficulties for so many, HMRC has made the welcomed decision to waive late filing penalties for self-assessment taxpayers.

HMRC will not charge late filing penalties for those who file online by the 28^th February 2022 or late payment penalties for those who pay the tax due in full or set up a payment plan by the 1^st April 2022.

John Cullinane, The Chartered Institute of Taxation’s (CIOT) Director of Public Policy, said, “We are pleased that HMRC will waive late filing and late payment penalties for one month. [Today’s] announcement shows HMRC have listened and acted on the concerns of our tax adviser members who report increased pressures on their workloads and significant staff absences because of the impact of the COVID pandemic, particularly the Omicron variant which is widespread during the peak filing period.”

“We would like the situation to remain under constant review. For example, it may be appropriate to introduce further easements similar to last year, such as extending the time limits for appealing any penalties which are levied and allowing tax advisers to make ‘bulk’ appeals on behalf of their clients.”

But Cullinane warns, “Taxpayers should beware that this is not a deferral of the tax return deadline itself. Where possible taxpayers should continue to file their return and pay any tax due by 31^st January, as interest will still accrue from 1^st February.

“This is not an opportunity for tax advisers to ‘shelve’ their tax obligations. A £100 late filing penalty could still apply if the tax return is not filed by midnight on 28^th February, and a five per cent tax geared penalty will be charged if there is any outstanding tax at midnight on 1^st April, unless a payment plan has been agreed with HMRC.”

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