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Revenue holds fire on late filing penalties

Landlords having problems meeting self-assessment filing deadlines have been allowed an extra month to complete their online returns.

HMRC has announced that it will not charge late filing penalties for 2020/21 self-assessment tax returns filed online by 28 February 2022, so allowing an extra month before penalties apply.

Almost 6.5m of the 12.2m self-assessment taxpayers have already submitted their tax return in advance of the 31 January 2022 deadline.

The statutory 31 January 2022 filing and payment deadlines are unchanged and HMRC said all those taxpayers who can meet these deadlines should do so.

However, those unable to meet the deadline will not receive a late filing penalty provided they file their online returns by 28 February 2022. Any taxpayer unable to pay their 2021/21 self-assessment tax due by the 31 January 2022 deadline will not receive a late payment penalty provided they pay in full or come to an arrangement for payment by 1 April 2022.

Interest on late payments will still be payable from 1 February 2022, at the recently increased rate of 2.75 per cent.

The Institute of Chartered Accountants in England and Wales has warned that taking advantage of these concessions in filing and payment deadlines may put class 2 national insurance entitlements at risk. Voluntary class 2 NIC will need to be paid separately if the liability is not recorded on HMRC’s system and/or payment not made by 31 January since entitlement to contributions-based employment and support allowance is based on class 2 NIC paid by that date.