The seasons are once again upon us, that being of course Christmas and the dreaded Personal Tax Return (PTR) season. Each year millions of businesses and individuals are required to file and submit their self-assessment annual return form, detailing exactly what requires to be taxed by HMRC. Below we break down exactly what needs to be included in your Personal Tax Return.
What is a Personal Tax Return & who do they apply to?
Self-Assessment, also known as your Personal Tax Return, is basically for anyone who is receiving undeclared income which is outside of PAYE (Pay As Your Earn). This means those who are self-employed, freelance, sole traders, landlords, dividend shareholders in a company, or profit from anything other than within PAYE employment are required to submit by midnight on the 28th of February (an extension from the usual 31st January deadline). As well as this, this also includes those who have received COVID-19 grants and support payments.
You will need to keep records (for example bank statements or receipts) so you can fill in your tax return correctly. If you do not submit your tax return by midnight on the 31st of January, you will be subject to a £100 instant fine. After 3 months if it still hasn’t been submitted, a further £10 per day will accrue which then rises to an additional £300 penalty 90 days after that, and then at 12 months a further £300 fine penalty (accumulating in £1600 each year in non-submission).
HMRC are extremely strict when it comes to penalties being issued, however it was predicted that the January 31st deadline would be extended due to COVID-19 pressures. As well as this, anyone who cannot pay their Self-Assessment tax by the 31 January deadline will not receive a late payment penalty if they pay their tax in full, or set up a Time to Pay arrangement, by 1st April 2022.
It’s worth noting that the regime for HMRC penalties will be changing in line with the introduction of MTD (Making Tax Digital) in April 2024. Taxpayers will receive a point every time they miss a submission deadline, which will be notified by HMRC. At a certain threshold of points, a financial penalty of £200 will be charged. The threshold is determined by how often a taxpayer is required to make their submission. When a taxpayer has reached the relevant threshold, as determined by their submission frequency, a penalty will be charged for that failure and every subsequent failure to make a submission on time, but their points total will not increase. The penalty thresholds are:
| Submission Frequency | Penalty Points |
| Annual | 2 |
| Quarterly (Including MTD & Income Tax Self-Assessment) | 4 |
| Monthly | 5 |
If you require any more information on personal tax returns, please do not hesitate to give us a call on 01992 642024.