Does the 5th October deadline affect you?

If you haven’t received a notice from HMRC to complete a self-assessment tax return for 2017/18 but think you owe Income Tax, Class 4 National Insurance or Capital Gains Tax for that year, you have until 5th October 2018 to tell HMRC.

Trap: If you miss the deadline for notifying HMRC that you owe tax, it can charge you a penalty equal to any tax etc. for 2017/18 that you then pay late. Late for this purpose means after 31st January 2019.

You should notify HMRC that you owe tax for 2017/18 in writing. You don’t need to calculate how much you think you owe, just that you believe there is a liability. The ball is then in HMRC’s court to ask for further information or for you to complete a tax return. You’ll then have until 31st January 2019 or three months from the date HMRC told you that a return was required, whichever is later, to submit the tax return and pay what’s due.

Tip: If you miss the deadline you can still avoid a penalty by working out how much tax you owe and paying it to HMRC on or before 31st January 2019.

To summarize, if you owe HMRC tax for 2017/18, but you haven’t been asked to complete a tax return for that year, you must notify it by 5th October or you could be liable to a penalty. If you miss the deadline, paying HMRC the tax you owe by 31st January 2019 will stop you from being fined.

For more information, we provide a Business Consultation to ensure our clients benefits from tax planning and accounting matters.

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