Self-assessment deadline one week away
If you miss the paper filing deadline, your only alternative will then be to file online before 31 January 2012. However, many don't find this practical and still prefer to submit paper copies. If this is the case, it is important to ensure you meet the 31 October deadline - you need to allow a couple of days for posting it. Even if you are just one day late you risk a hefty penalty.
Anita Monteith, from ICAEW's Tax Faculty explains: "Self Assessment involves completing a tax return to inform HMRC of your income and capital gains for the tax year which runs from April 6 to April 5. Taxpayers have a choice of filing a return online or on paper.
"If you wish to file a paper return for the year ended 5 April 2011, the deadline for submitting it is Monday 31 October. If you miss this deadline and still file a paper return you will be liable to penalties and possibly also to interest. The longer you delay, the more you'll have to pay. This will not fill you with Christmas cheer."
If you are one day late submitting your return a fixed penalty of £100 will apply even if you have no tax to pay or pay the tax you owe in full by the payment deadline of 31 January 2012. This is a new rule for this year. Previously, as long as you paid all the tax you owed by 31 January, the penalty was reduced to nil, but this is no longer the case. With the average family spending £600 on Christmas presents, this penalty could force you to be a scrooge this year when it comes to filling up those stockings.
A penalty for a late tax return could eat into your Christmas food budget this year. With the average Christmas dinner for a family of 4 setting you back £67.37 (£16.84 each), a fine from HMRC could impact on how much you can spend.
If you submit your return more than 3 months late, the penalties begin to snowball starting with an additional £10 for each following day up to a maximum of £900. This is in addition to the fixed £100 penalty.
Monteith adds: "You will not have to pay a penalty if you have a reasonable excuse for missing the deadline. This must be something major and unexpected that is outside your control. Some examples include: documents being lost through fire, theft or flood that you cannot replace in time, life-threatening illness, the death of a partner shortly before the filing date or industrial action by Royal Mail over a lengthy period of time. You should make any claim as soon as possible - do not wait until you receive the penalty."
Alternatively, you can file your return electronically until 31 January 2012.