Have You Missed the October 5th First Time Tax Return Deadline?

How bad is it if I miss the deadline?

You are not necessarily in serious trouble if you miss the deadline of October 5, but you will raise a flag with HMRC. The most important thing is to ensure that you do not miss the subsequent deadlines-particularly January 31st for submitting your tax return and paying any tax you owe.

What we want to avoid is compounding the issue. The longer you delay, the more penalties can build up, especially if you owe tax. But if you act now and file your return before January 31st, you may avoid further penalties beyond any initial registration fine.

What should I do now? Is it too late to fix this?

It is not too late to put things in order. Here are the steps you should take:

• Register as soon as you possibly can: You still can after October 5th via HMRC’s website. When you do this, you will be assigned a Unique Taxpayer Reference number, so you can actually make your tax return. The sooner you do, the better.
• Prepare for the next deadlines: Although we have missed the registration deadline, we can still meet the deadlines of January 31st both for filing your tax return and paying any taxes due. This is now the most important thing to focus on-getting your return filed on time to avoid further complications.
• Prepare your documentation: This will include all your records regarding income, any permissible deductions, and other financial information that may be required for the return. If you are not sure what you need, we can work this out together.

What if I have a good reason for being late? Can that help me?

Yes, of course. They will waive the penalties or reduce them if you have what HMRC defines as a “reasonable excuse” for not meeting the deadline. Some general valid reasons will include:

• Serious illness: If you were ill or in treatment for something that stopped you from meeting the deadline.
• Bereavement: If you lost a close family member around the time of the deadline, this may also constitute a valid reason.
• Technical issues: If HMRC’s online system was down at the time you tried to register, that could also be a reasonable excuse.
• Delays in post:  If you were relying on registration by post and there were some delays beyond your control, you could have reasons for making an appeal against the penalty.

The main thing to do is to inform HMRC as soon as possible if you think you have a good reason. If you are unsure whether your reason qualifies, then we can help you assess this and present it to HMRC in the best possible light.

Will HMRC give me a penalty for registering late?

There may also be a fine from HMRC for registering after October 5th, but it’s by no means certain. In general, late registration is fined £100 if you owe tax. If no tax is due, HMRC are not necessarily issuing a fine, really. Usually, they will just focus penalties on people who owe tax and don’t meet deadlines.

Even if a penalty is issued, you do have recourse. If we can prove that your delay was caused by a reasonable excuse, then we can appeal the penalty. In any event, provided you file your tax return online by January 31st and pay any tax due, the penalties will not increase any further. The worst thing you can do is ignore the problem and let it escalate.

I’m afraid that I will miss more deadlines. What is next?

Fortunately, the next deadlines are in some months, and we should be able to prepare ourselves. Our key dates for attention are:

January 31st: The deadline for filing your Self Assessment tax return online, and to pay any tax you owe. This is the big one. If you miss this one, you will start getting additional penalties and interest on top of your unpaid taxes. We don’t want that, so we avoid it at all costs.

In the meantime, we can work together so you correctly, fully, and timely file the tax return. If you have never done this before, we can walk you through what is needed and help you organise your finances so it’s a non-stressful process.

What if I’ve never filed a tax return before? What should I expect?

That’s quite overwhelming for a first timer, but I’m here to make the process as smooth as possible. The Self Assessment tax return describes your income on which you have to pay certain amounts of tax due-particularly when you are self-employed, a landlord, or earn an income that isn’t channeled under PAYE, which refers to the system used in collecting tax from your employment wages.

Once signed up, you will receive your UTR, and we will complete your tax return from your sources of income, your deductions-be they business expenditure, pension contributions, or donations to charity-and any other relevant financial information. We will look to maximise any allowances and reliefs available and hence minimise the tax payable.

I am selling merchandise or services through Amazon.com, eBay, or other e-commerce websites. Is there anything about this I should be concerned with?

Of course, the other area people most commonly fall into with HMRC is selling products or services via the online platforms: Amazon, eBay, Etsy, or even run some form of business through Airbnb, and freelancing on sites like Fiverr. Many are under the impression that this, because these very sales are often casual, part-time, or infrequent, are not to be declared. Unfortunately, that’s just not true.

Even if you are selling items on a casual basis, or just as part of a small side business, HMRC still classes this as taxable income the moment you earn more than a certain threshold. The  trading allowance is £1,000. Anything over and above this limit needs to be declared through a Self Assessment tax return. This also applies if you gain money via websites by selling your services, like consultancy or freelance work. These liabilities could easily go unnoticed if you are not aware of them, whether it be the deadline for registration or noticing that you have to file a tax return in the first place.

How do I know if I am required to file a tax return for my online sales?

That means you need to notify HMRC if your online sales or services reach more than £1,000 in one tax year. It could be anything-from the artistically crafted items sold on Etsy to drop-shipping via Amazon and even down to flipping items on eBay. And more than this, most people are not aware that such constitute taxable income, even when it’s just a hobby or done in addition to other regular employments. Failure to declare it may result in penalties later, especially if HMRC catches up with the earnings made through those very platforms.

Don’t forget to Deduct your business expenses from your income if your expenses exceed £1,000.

If you are in doubt as to whether your online work warrants declaring, it’s far better to be safe than sorry and potential fines later on down the line. We can work through your income together, ensuring that you are fully compliant and taking full advantage of allowances or deductions that may apply to reduce your tax bill.

I’m still not quite sure about what the next steps are. What do I need to do?

If you are feeling apprehensive or intimidated, my suggestion is the following: TAKE ACTION. The sooner we can register and start this process, the less stress-and fewer or no penalties-we will have to deal with.

Remember, the longer you leave it, the more fines and complications mount up. But the quicker we act, the less of those issues there will be, and we can ensure you remain compliant and get you on the right track.

If you need help, don’t hesitate to reach out. We are here to take you through this process step by step, and we’ll make sure everything is sorted before the January deadlines.