Are you struggling to pay your Self-Assessment?
Do not panic. There are loads of people in your situation. Saving for your tax bill is challenging, and a lot of people don’t.
As a tip, save 20% of your income as you go along. That 20% will then pay your tax bill, and you will probably have some leftover!
We can support you with what to save. Call 01243 201 401 for a free Bookkeeping review and help with your taxes.
So what do you do if you can not afford it? First, you have to contact HMRC; the sooner, the better.
You will get a letter from HMRC telling you how much tax to pay, and this is the time to call them.
Whatever you do, do not ignore HMRC; they do not like it.
If you ignore the letter, they will fine you and charge you interest.
Call them ASAP on, 0300 200 3822 and talk to them, they have no desire to put you out of business just getting the tax paid.
IF you are late in filing you will also get fined based on your lateness:
• 1 day late - you’ll have to pay a penalty of £100
• 3 months late – you may have to pay a penalty of £10 a day, maximum of 90 days (£900)
• 6 months – you’ll have to pay a further penalty of 5% of the tax you owe or £300, whichever is greater
• Over 12 months – you’ll have to pay a further penalty of 5% of the tax you owe or £300, whichever is greater
Example : Your Self-Assessment tax bill is £1,000. You file late, say 4 months
The cost is £410 in fines and a penalty for paying late of £50 and then they add interest of £9.
So, the total cost of filing late will be £469 on top of your £1,000 tax bill!
Wait another month, and the fines jump to £780!
Again HMRC has no desire to put you out of business, so it is essential to get your Self-Assessment in on time regardless of the tax bill.
Call us on 01243 201 401 and we can ensure your tax affairs are sorted and you avoid fines.
If you can’t afford the bill, call them, 0300 200 3822 and talk to them, they are not scary and want to help you pay your tax.
Ask for a payment plan, a period to pay the tax bill over, up to 9 mths.
Ask to pay the £1,000 over 9 mths and save yourself £460 in fines and penalties.