Contractors' Questions: What if I file my tax return late?
Contractor’s Question: What are the consequences for me if I don’t manage to file my online tax return for 2011-12 by January 31?
Expert’s Answer: Contractors who fail to meet HMRC's deadline risk incurring significant penalties.
Those who issue a late submission to HMRC can expect to be stung with a minimum penalty of £100. However, the longer the filing is stalled, the greater the forfeiture.
The tax authority will exact further penalties following delays of three, six and twelve months - which could see self-employed workers forced to pay sums upwards of £1,600.
Contractors whot file a late tax return also risk having their yearly tax contribution estimated by HMRC. This sum will have to be paid, in addition to the interest on any late payments.
When dealing with the growing complexities of tax obligations, self-employed workers are recommended to turn to an accountancy firm they can trust.
The expert was Andrew Nixon, director at Nixon Williams, an accountancy firm specialising in freelance workers.