Phone lines stay open as tax return deadline looms

Phone lines are being opened and webchat services extended by the UK's tax authority on the final day before the self-assessment deadline.

Millions of people who are self-employed or have more than one source of income are required to file a 2024-25 tax return online by the end of January.

HM Revenue and Customs (HMRC) has scaled up Saturday support for those leaving it to the last minute. Some 1.1 million people missed the cut-off a year ago.

Previous excuses for failing to file have included being up a mountain or yachting around the world. Reasonable excuses for avoiding fines include serious illness or a close family bereavement.

Anyone who fails to complete a required return by the end of Saturday faces an automatic £100 fine and the possibility of further penalties.

More than 10 million people have already filed the latest tax return, according to HMRC, but thousands always leave it to the final day.

The tax authority said digital services were the fastest way to access support on Saturday.

A webchat was being extended to 10 times its usual Saturday capacity, with the digital assistant service running all day as normal.

The telephone helpline, usually closed on weekends, is open from 09:00 GMT to 16:00 GMT for those who need to speak to someone about self assessment.

HMRC has faced sharp criticism in the past for the time it takes to answer phone calls, and waits are expected to be relatively long on Saturday.

Who files and who doesn't

Millions of people pay only have tax automatically deducted from their wages through PAYE (pay-as-you-earn), but those with more than one source of income may need to file.

They include those earning more than £1,000 in the 2024-25 financial year from self-employment or by letting out a property or land.

Some not required to file this time include those earning more than £150,000, whose high income was the only reason they needed to file previously, or those who have switched to paying the high income child benefit charge through PAYE.

Some people may be missing out on tax relief by submitting an incomplete tax return or not doing one at all.

Sir Steve Webb, partner at consultancy LCP, estimated that about 800,000 higher or additional rate taxpayers could be missing out on extra tax relief by failing to declare a personal pension or other "relief at source" scheme.

Penalties can build up

Those required to complete a return must also pay any tax bill.

"Filing the return is only half the battle - you must also pay any tax owed for the 2024-25 tax year by January 31 which will require sufficient cleared funds available in your bank account ahead of the deadline," said Alice Haine, personal finance analyst at Bestinvest.

Those who are unable to pay in full by January 31 may be able to set up a "time to pay" arrangement online if they owe less than £30,000 and meet the criteria.

Anyone missing the filing deadline faces the following penalties:

• An initial £100 fixed penalty, even if there is no tax to pay, or if the tax due is paid on time
• After three months, there could also be additional daily penalties of £10 per day, up to a maximum of £900
• After six months, there could be a further penalty of 5% of the tax due or £300, whichever is greater. After 12 months, there could be another 5% or £300 charge, whichever is greater
• There are also additional penalties for late payments of 5% of the tax unpaid at 30 days, six months and 12 months
• If tax remains unpaid after the deadline, interest may also be charged on the amount owed

HMRC will consider customers' reasons for missing the deadline. Those with a reasonable excuse may avoid a penalty.

People should also watch out for scams, with criminals attempting to dupe taxpayers by purporting to be from HMRC. Fraudsters may threaten people, claiming they have an unpaid tax bill, or they may make offers of fake rebates.

Digital overhaul from April

From April, taxpayers with more than £50,000 of gross income from self-employment or rental income in the 2024-25 tax year will need to comply with Making Tax Digital rules which will replace self assessment.

They must keep digital records using approved software and submit quarterly income and expense summaries to HMRC.

The threshold drops to £30,000 from April 2027 then £20,000 from April 2028.

"Making Tax Digital is the biggest tax change since self assessment and, with just over two months to go, time is running out to get ready," said Victoria Todd, of the Low Incomes Tax Reform Group, which has produced a guide for those unsure of the changes.