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Don’t be caught out with spiralling tax penalties

Small businesses across Durham are being urged to avoid spiralling penalty charges by ensuring they meet the filing deadline for their tax return.

Malcolm Massey who runs TaxAssist Accountants in Durham comments: “Last year 890,000 taxpayers received an automatic late filing penalty of £100, even if they were only one day late in filing. For a delay in excess of 12 months, penalty charges can spiral to in excess of £1,600. We don’t want any local businesses to be caught out.

“The £100 penalty is applied, even if there is no tax to pay or you pay the tax due on time.

It can work the other way too. Some small business owners might be due a tax refund, so the sooner they file the sooner that money can be working for them in their bank account.“

The deadline for businesses and taxpayers who choose to file their tax returns on paper is 31st October, whilst those who file online have until 31st January 2016. Last year, 10.24 million tax returns were filed by 31st January; 14.5% of which opted for the paper option.

Apart from the immediate £100 penalty for late filing, subsequent fines are:

After three months, additional £10 per day penalties up to a maximum of £900 After six months, a further £300 penalty or 5% of the tax due, whichever is greater After 12 months, another £300 charge or 5% of the tax due, whichever is greater

TaxAssist Accountants Durham is a local business, providing tax and accountancy advice and services purely to small businesses.

This was posted in Bdaily's Members' News section by TaxAssist Accountants .