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Don’t be caught out by new tax return rules

Don’t be caught out by new tax return rules

Category: Money

Updated: 24/01/2014
First Published: 24/01/2014

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Tax return deadline is a mere week away, and that means you've only got seven days to complete your online return, submit it and pay anything you owe to HMRC – or face a penalty for filing late. A lot of people might be in a state of last-minute panic but some might not even know they need to fill in a return, with changes to the Child Benefit system last year meaning higher earners could well need to repay a hefty chunk…

The new rules meant the benefit would be withdrawn from some 1.1 million families with one earner on more than £50,000, but it was up to the families themselves to request that their payments be stopped. Failing to do so means they'd have to go through the self-assessment process to repay anything they owe for the period 7 January-5 April 2013, and this is something that thousands of families are finding themselves lumbered with.

However, there are concerns that some are still unaware that they need to file a return, so for anyone that's reading this and think they might be affected – it's time to act.

If you've yet to register for self-assessment online, you've already missed the recommended date for requesting an activation code – it can take up to ten days to arrive in the post – but that doesn't mean all is lost. Apply RIGHT NOW and you could still get it in time, and if you miss the deadline you have up to 30 days from receiving a fine notice to file a "reasonable excuse" claim form.

It isn't something you want to overlook. The initial missed deadline penalty is £100, but leave it too long and those fines (and the interest charged) can quickly escalate – after six months you could owe over £1,000, perhaps more if you've failed to even register.

So, make sure to start the process of filing your return straight away. Of course, those that aren't affected by the changes still need to make sure they file by next Friday, so this weekend could be all about getting the necessary paperwork together.

Here's a list of who needs to fill in a tax return, just in case you're unsure:

  • Those who are self-employed
  • Company directors, ministers or Lloyd's names/members
  • Higher earners with an annual income of £100,000 or more
  • Those who receive income from savings, investments or property
  • Those that want to claim expenses or reliefs (above £2,500)
  • Families who receive Child Benefit where one partner earns £50,000 or more
  • Those that receive income from overseas
  • Those that receive income from trusts, settlements or estates
  • Those that have to pay Capital Gains Tax
  • Those that live/work abroad or aren't domiciled in the UK
  • Trustees

And, here are a few extra tips to make sure you're good to go:

  1. Make sure you've got your UTR (unique taxpayer reference) and national insurance number handy, and don't get the two confused.
  2. Double-check your tax code.
  3. Find all your statements for savings/investments and make sure you're putting in the right interest amount.
  4. Know what you can claim for to reduce your tax liability.
  5. Remember to fill in the "charitable giving" section to claim additional relief.
  6. Make sure you've properly submitted your return – reaching the calculation page doesn't mean it's submitted.
  7. Don't forget to pay what you owe!

What Next?

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Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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