Glenn Collins, head of policy, technical and strategic engagement at ACCA UK explains: ‘This New Year is critical for many SMEs and individual taxpayers who are coping with the uncertainty due to Covid-19 restrictions over the festive season, and so this extra month to get organised and file their returns for 2020 / 21 is much needed at such an exceptional and turbulent time. It will also help HMRC’s resilience and hopefully its performance over this period.’
This gives businesses and individuals extra time, if they need it, to complete their 2020/21 tax return and pay any tax due. Interest will be payable from 1 February, as usual, so it is still better to pay by 31 January if possible.
More than four million emails and SMS will be issued to Self Assessment customers pointing them to guidance and support, prompting them to think about how they intend to pay their tax bill, and to seek support if they are unable to pay in full by the deadline. Businesses were reminded recently by HMRC of the need to report taxable grants and payments received from Governments and local authorities during the pandemic. Loans such as Bounce Back Loans or CBILS do not need to be reported.
Glenn Collins continues: ‘There are clearly challenges ahead, both for businesses managing their cashflow, and for HMRC in seeking to recover unpaid taxes, whilst supporting those that are struggling.
‘It’s been recently reported that tax debts hit £42 billion, with 6.2 million taxpayers owing money to HMRC, an increase from 3.8 million at the start of the year. We welcome this delay as we were concerned about pressures building on small businesses who are now faced with paying back the tax bill on the grants and payments they received to keep them afloat from the early stages of the pandemic until April 2021.’
ACCA UK says that this huge tax demand will hit businesses who are just regaining profitability and will put a further squeeze on them due to increased tax on dividends and employers’ National Insurance for the health and social care levy.
ACCA UK’s also reminding business owners of the dangers of scams at this time of the year. As HMRC will be issuing emails and SMS to Self Assessment customers, they are reminding them to be on their guard after nearly 800,000 tax-related scams were reported in the last year. Fraudsters use self-assessment to try and steal money or personal information from unsuspecting individuals. In the last year alone, HMRC has received nearly 360,000 bogus tax rebate referrals.
- ends -
For media enquiries, contact:
M: +44 (0)7725 498 654
About ACCA: ACCA (the Association of Chartered Certified Accountants) is the global professional body for professional accountants.
We’re a thriving global community of 233,000 members and 536,000 future members based in 178 countries and regions, who work across a wide range of sectors and industries. We uphold the highest professional and ethical values.
We offer everyone everywhere the opportunity to experience a rewarding career in accountancy, finance and management. Our qualifications and learning opportunities develop strategic business leaders, forward-thinking professionals with the financial, business and digital expertise essential for the creation of sustainable organisations and flourishing societies.
Since 1904, being a force for public good has been embedded in our purpose. In December 2020, we made commitments to the UN Sustainable Development Goals which we are measuring and will report on in our annual integrated report.
We believe that accountancy is a cornerstone profession of society and is vital helping economies, organisations and individuals to grow and prosper. It does this by creating robust trusted financial and business management, combating corruption, ensuring organisations are managed ethically, driving sustainability, and providing rewarding career opportunities.
And through our cutting-edge research, we lead the profession by answering today’s questions and preparing for the future. We’re a not-for-profit organisation. Find out more at accaglobal.com