Paper Self-Assessment tax returns for 2009-10 have to reach HMRC by 31 October 2010 otherwise you risk being charged a late-filing penalty. Here is a recap of the rules.
Introduction
Many of those who complete a tax return have now switched to filing online which still allows you to file by 31 January 2011 for the 2009/10 tax year. However for many taxpayers this is either not possible or practical or they still prefer to complete and submit a paper return – in which case they have to do so by the earlier deadline of 31 October 2010.
Particularly if you are in the latter group, and haven’t done so already, make sure you now start gathering the information you will need so that you have everything to hand when you come to complete the tax return.
Recalling the postal difficulties experienced by paper filers in October last year, it would be good to get your return submitted well before the deadline, especially as 31 October falls on a Sunday this year.
The long and short of it
There are two types of paper tax return – a short version and a long (or ‘full’) version. Both the full tax return and the short tax return have changed little this year in layout. You can only use the short form if HMRC send you one – unfortunately if they have sent you the long one, you have to use it and cannot ask for the short one instead.
There are some situations when you cannot use a short tax return even if you have been sent one. If you find that to be the case, you will need to obtain the full version and any additional pages you require. These can be downloaded from the HMRC website (see useful links below) or you can call the Self-Assessment helpline on 0845 900 0444 (Text Relay prefix 18001, Textphone Taxes contact centre 0845 302 1408).
But it is worth noting that even if you have made some small capital gains you will still be able to use the short tax return by following the instructions at box 7.4, now found on page 3. The short tax return can also now be used if you are repaying an income-contingent student loan as noted in our earlier article.
If you use the full return and are entitled to the married couple’s allowance (basically where you are married or in a civil partnership and one of you was born before 6 April 1935), make sure you note that this is claimed by completing the boxes on page 3 of the separate ‘Additional information’ sheet. This can be easily missed.
Key pointers
Things to remember when filing your 2010 paper tax return are:
- The filing date for paper returns is 31 October 2010. After that date any paper return is deemed to be filed late. You cannot file a paper return late, then – in an attempt to escape the penalty – file again online.
- It is always helpful to keep a copy of the return together with the other records you used to prepare it – particularly if it gets lost or HMRC raise any queries relating to it (an ‘enquiry’).
- HMRC do not give receipts for tax returns either posted to them or handed in at an Enquiry Centre. If you are posting the tax return, ask the Post Office for a certificate of posting or send it recorded delivery, and keep the receipt with your other papers. If you hand the return in at an Enquiry Centre, make a diary note of when. Our recent article ‘Tax return receipts – too much to ask?’ calls on HMRC to reconsider their policy of not offering receipts.
- The date you have to pay any tax due is still 31 January 2011 (and you might also have to make your first payment on account for 2010/11 by that same date).
- Those who file paper returns after 31 October 2010 will incur a penalty of £100, but if all the tax you owe has been paid by 31 January 2011 the penalty will be reduced to NIL. However, this may be the last year that this ‘capping’ rule will apply as it is intended that a new penalty regime will come into effect from 2012.
- If you file your paper return by 31 October 2010, HMRC guarantee to calculate your tax liability and advise you in time to pay it by 31 January 2011.
- If you have underpaid tax, and your income is taxed under PAYE, you can opt to have the underpayment collected through your 2011/12 coding if your paper return is filed by 31 October 2010 and the underpayment is no more than £2,000.
Online filers
HMRC offer free software on their website for most who feel confident to file online and have access to a computer and the internet (see HMRC’s website and follow ‘do it online’ from the home page). Exceptions to this are partnership, and trust and estate returns (see below). The main benefits, apart from the later filing date, are:
- you get an instant confirmation that the return has been received;
- an immediate calculation of the tax payable is available; and
- if you are due a refund of tax, this is likely to be received quicker.
If you wish to make the switch to online filing, you should not leave it too late to register as it will take several days before you receive the authorisation code which enables you to get started.
If you are unable to file online because of problems with HMRC’s online service and are instead forced to file a paper return to meet the 31 January deadline, then you should appeal against the penalty on the grounds that you had a ‘reasonable excuse’ for missing the deadline. Details of how to make a ‘reasonable excuse’ claim can be found on HMRC’s website (see useful links below) and you will be asked to give details of any on-screen error messages that appeared.
Partnerships, Trustees and Executors – beware!
As we warned last year, there is little publicity from HMRC of the fact that if you want to file your partnership tax return online you need to buy commercial software. HMRC software is only able to accept information for the partnership pages in individuals’ tax returns and there is no facility to file the separate partnership return using their software. The same also applies for trustees and executors filing trust and estate tax returns – these can only be done through commercial software.
Your options are therefore to:
- submit a paper version of the partnership/trust and estate return by 31 October; or
- purchase a commercial software package (HMRC gives a list of commercial software providers on their website – see useful links below) and register through the HMRC online services well before 31 January to give time for the authorisation code to be sent out. Note that you also need to register each partner separately if they want to file their returns online.
There are fixed penalties applied of £100 per partner for filing a partnership return late.
Useful links
Download Self Assessment tax return pages from the HMRC website
LITRG ‘reasonable excuse’ guidance.
HMRC guidance on how to make a ‘reasonable excuse’ claim
HMRC’s list of commercial software providers
The LITRG website gives further guidance generally on self assessment.
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