The 31 January 2025 Filing Deadline – Self Assessment

As the festive season approaches many of those in self-assessment will soon be winding down for the holidays content that their 2023/24 tax returns are submitted. On the other hand, some people may be pushing the 31 January 2025 filing deadline to the back of their minds, hoping to deal with it all in the January rush.

With less than 9 weeks to go until 31 January 2025, it is important that you ensure you meet your reporting obligations to HM Revenue and Customs (HMRC) on time. If not, you could face late filing penalties and interest charges on any unpaid tax liability (not a great start to the New Year).

Do I need to file a tax return?

Some individuals in self-assessment will have been in it for many years and will be very comfortable with the process, what needs to be reported and when. However, for those who have never been in self-assessment before and do not know if they need to file a tax return, there is a handy tool on HMRC’s website that can let you know if you need to file a tax return.

Broadly speaking you will need to file a 2023/24 tax return if you meet any of the following in the year to 5 April 2024:

• You have total taxable income exceeding £150,000
• You earned more than £1,000 in turnover from self-employment.
• You were a partner in a business partnership.
• You are required to pay the high-income Child Benefit charge

You will also be required to file a tax return if during the year ended 5 April 2024 you received any untaxed income from sources such as property, savings, investments, dividends or income from overseas sources.

There are many other reasons in addition to the above why a person might need to file a 2023/24 tax return with some reasons even include reclaiming overpaid tax. If you are unsure if you need to file a return, please get in contact with a member of our team.

What happens if I file or pay late?

The 31 January 2025 is a hard deadline and cannot be extended. With the paper filing deadline having already passed back in October, all 2023/24 tax returns must be filed online by 31 January 2025, or the individual will be levied with an immediate £100 late filing penalty.

Whilst these penalties can in theory be appealed, the conditions for appealing are very strict and HMRC are very unlikely to cancel late filing penalties except under exceptional circumstances.

Further penalties will become payable once the filing deadline has passed:

For those who have tax to pay, HMRC will automatically apply interest to all late payments of tax. The interest rate on outstanding income and capital gains tax is currently 7.25% which is on the decline from last year but can still result in very high interest charges, especially for those with significant tax liabilities.  

The interest charges for late payments are also significantly higher than the overpayment interest rate of 3.75% that HMRC will repay to taxpayers who have overpaid their tax for the year.  

Similarly to the late filing penalties, late payment penalties also arise on top of the interest once 30 days have passed from the due date: 

If a taxpayer is struggling to make tax payments by the due dates, then they can contact HMRC in order to see if they can obtain a Time to Pay arrangement. If this is arranged then no late payment penalties will arise, though importantly the late payment interest charges will always be levied.

You can set up a Time to Pay arrangement if all of the following conditions are met:

• You are up to date on your Self-Assessment Tax Return filing and have filed your latest Tax Return.
• You have a Tax Liability of £30,000 or less.
• You are within 60 days of the payment deadline.
• You do not have any other outstanding payment plans or debts to settle with HMRC

To set up a payment plan with HMRC, they will ask you about your income position and your spending patterns.

How Can We Help?

If you need any support, advice or guidance with completing your tax return, or if you have any questions about the 31 January filing deadline, please do not hesitate to get in contact with Carol Edwards, Annabel Jagger, or your usual AAB contact.