Changes to Tax Payments
A number of changes to the way taxes are paid have now come into effect.
1. Companies and organisations must submit their tax returns online.
2. Corporation tax and related payments must be paid electronically.
3. If exceptionally, a payment is made by cheque, funds will be treated as being received by HMRC only on the date funds reach HMRC’s bank account.
4. HMRC will start issuing late payment penalty notices to customers who paid their PAYE late in the 2010-2011 tax year.
5. From April 2011, businesses that should have submitted their VAT returns online but sent it in by paper instead will be charged a penalty. These penalties will apply to returns for accounting periods ending on or after 31 March 2011.
New online VAT rules
New regulations governing the filing of VAT returns and the payment of VAT liabilities are to come into effect next year.
1. Firms with a VAT turnover of less than £100,000 annually and that registered for VAT before 1st April 2010 must submit their returns online and make payments electronically as from April 2012.
2. HMRC is urging businesses that still use paper returns to get ready and to sign up for electronic filing in 2011, well ahead of the switch.
Penalties for filing Late
The penalties for late filing of your Self Assessment Tax Return or late payment of your tax have changed from April 2011. They are now as follows:-
1. One Day Late:- you will be charged an initial penalty of £100
2. Three Months Late: - daily penalty of £10 per day up to a maximum of £900.
3. Six Months Late: - you will be charged further penalties, which are greater of 5% of tax due or £300.
4. Twelve Months Late: - you will be charged yet more penalties, which are the greater of 5% of tax due or £300. In particularly serious cases you face a higher penalty of up to 100% of the tax due.
Penalties for paying Late
The penalties for paying late are as follows:-
1. Thirty days late and you will be charged an initial penalty of 5%
2. Six months late and you will be charged a further penalty of 5% of the tax that is still unpaid
3. Twelve months late and you will be charged a further penalty of 5% of the tax that is still unpaid.
For more information Jonathan can be contacted on 0161 761 5231 or email jonathans@horsfield-smith.co.uk
Professional advice should always be sought as individual circumstances may differ.
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