Millions of self-employed Brits warned simple tax mistake could cost hundreds

MILLIONS of Brits could be caught out by a simple tax mistake that could cost hundreds of pounds.

Self-employed workers have been given an extra month to file their tax returns without being fined – but you could still be hit with extra costs.

HMRC has granted an extension from January 31 until February 28 for workers to submit their self-assessment forms.

It has waived the fine for a month to give the 6million taxpayers who are yet to file extra time to do so.

Normally, the fine for filing after the deadline is £100, rising to as much as £900 depending on how late it's submitted.

However, experts have warned self-employed workers not to get confused by the extension, as tax due for the financial year ending April 5 2021 still needs to be paid by January 31.

The government will still add 2.75% interest from February 1, so it's still better to submit your return by the end of January.

You'll also be hit with a 5% late fee if you haven't settled your tax bill or set up a payment plan by April 1.

Most read in Money


I'm a heating expert – here's four tips to save up to £692 on your bills


Thousands of families can get up to £115 FREE cash to help cover household bills


We've sat on garden chairs for 10months- our £3.5k sofa's still not been delivered


I cleared £5,000 debt in just 10 months – how you can do it too

Royal London’s consumer finance specialist Sarah Pennells said: “People who will struggle to file their tax return by January 31st will welcome the fact that HMRC is giving them an extra month before it imposes any late filing or late payment penalties.

"But anyone who can file by the deadline of January 31 should do so.

"While you won’t have to pay a late filing penalty as long as you file your tax return by February 28, you will be charged interest from February 1 on any tax you owe.

"If you can’t make the January 31 deadline, try and file your tax return as soon as you can to avoid a last-minute rush before the end of February.”

Filling out a self assessment tax form can be confusing, but we've got a step-by-step guide to help you through it.

The deadline to file a paper tax return has already passed as the cut off point was October 31.

Meanwhile, Martin Lewis urged employees to check their tax code to avoid being overcharged hundreds of pounds.

    Source: Read Full Article