Are you an Irish tax payer who is yet to get your accounts in order and file tax returns? You better get started now if you would like to avoid penalties that can amount to a “small fortune”! There is no reason to panic though, as you are not alone. In the UK, almost 1 million other people failed to meet the deadline of January 31st. In Ireland specifically, you can estimate about a little less than half the country’s taxpayer’s have not submitted yet. Now that you may feel less intimidated, let’s take a look at some key points to note on consequences of delayed filing, when to request a waiver and the next steps.

Delayed Filing of Returns

• As soon as the deadline of 31st January is missed, an automatic penalty of 100 pounds is issued. This has to be paid irrespective of whether you owe the HMRC tax or not.
• After this, you have three months to get your accounts in order and submit the returns.
• At the end of three months, i.e April, you will be entitled to pay 10 pounds every day for the next 90 days. This can push up your total penalty to a whopping 900 pounds!
• If after 6 months first and 12 months next, your tax returns are not filed, further penalties are issued. The amount will be decided based on the outstanding that you have gathered until then. This is not including interest that you will be charged on all the unpaid tax.

 Requesting a Penalty Waiver There may be a number of reasons why one can’t submit. And the HMRC does allow for a couple of reasonable instances where one is unable to make the deadline.

• A “reasonable excuse” can get you out of the penalty, but the decision is at the discretion of your tax official.
• Health and sickness are considered grounds on the basis of which you may get a waiver. A terminal illness for self or close family can get you through.
• IT and technical problems are unavoidable and sudden. This is also considered a reasonable reason for delayed payment. Either the HMRC online services were down that day or your network was undergoing a server issue; either way, this can be submitted along with proof to get a waiver.
• These genuine excuses are being taken into account as the HMRC would rather focus on deliberate tax evaders who get away with a large liability.
• However, even if you do have a reasonable, genuine excuse for missing the first deadline, ensure that you pay your returns by the next in order to avoid heaping a huge penalty.

Next Steps If you are getting ready to pay your dues now. There may be one more point you would want to consider. HMRC charges penalties for errors in your return called inaccuracy penalties. This is the case when the authorities feel that you have submitted numbers that have resulted in lessening your liability or claiming too much relief and rebate. Although there are provisions to waiver this by way of claiming it a “careless” mistake, authorities are unlikely to consider the same. So do pay attention to filing your returns. If this is something you’ve taken care of too, then you are on your way to completing your tax filing formalities. We highly suggest you try to get this over with by the end of February in order to make sure that you aren’t charged more penalty than necessary. If you’d like some guidance in any of the procedures of filing online, being compliant or appealing for penalty waivers, you have DataTracks to help you out. Get in touch with one of our compliance experts today at enquiry@datatracks.ie