January 9th, 2016

What’s so special about Midnight 2 March 2016?

imageIt might seem like just another day…

But for some people it could be hellishly expensive.  Here’s why.

Any tax due for the year to 5 April 2015 should be paid by 31 January 2016. After that you have to pay interest – currently 3%.

On a tax bill of £10,000 that works out at 82p a day. Pretty cheap borrowing really.

Here’s the catch though.  Any tax not paid 30 days later – 2 March – gets hit with a surcharge of 5% on the whole lot. That’s an APR of more than 60%.

Here’s a few key facts:

  1. The surcharge doesn’t apply to payments on account.
  2. HMRC expect payments to be made on time – even if the tax returns are late. Think about paying an estimated amount.
  3. You can get the surcharge suspended by entering a ‘time to pay‘ arrangement with HMRC.  Do this before the payment is due though.

As usual – if you need more help then get in touch.

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Freelancers HMRC Penalties

by
Managing Director

Jonathan trained as a chartered accountant with Price Waterhouse (now PWC) in Liverpool before becoming a small business services manager for Grant Thornton in Warrington. He also spent three years as the financial controller for Brookside and Hollyoaks (not that he ever mentions it!).

Jonathan is recognised as a specialist in the entertainment industry and is often called upon to provide training courses and seminars for media professionals. He's also a bit of a technology geek and has been recognised with the accountancy industry as one of the most progressive accountants in the UK.
Outside of work Jonathan is very proud to be the Treasurer of the Tim Parry Johnathan Ball Foundation for Peace and to be on the Council of the Liverpool Institute of Performing Arts (LIPA)

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