2014 financial diary
Whether it's a smartphone, tablet or a pen and ink paper diary, it's time to set up alerts and markers for essential tax dates. Ignoring these could incur substantial penalties and lose tax saving opportunities.
Here's our calendar:
January 31. This is the deadline for filing online returns and paying tax owed for the ten million plus in the self-assessment tax system – those with self-employment (even if not their principal job), those with investment income of £10,000 or more, company directors, those in partnerships, those earning over £100,000 and many other categories.
This date has passed and although HMRC has not yet released figures for how many missed it this year, on past experience it's likely to be around 700,000.
There is an immediate £100 fine for falling at this hurdle – even if you owe no tax or are due a rebate. The penalty, unchanged in two decades, is for late filing. But the clock starts ticking on February 1 and like a taximeter, the further you go, the faster the numbers mount up.
This is also the date for settling any capital gains tax due for the previous tax year.
Ignoring these essential dates could incur substantial penalties.
March 1. Long standing unpaid tax incurs a further three per cent interest plus another five per cent.
April 5. The end of the tax year with “use it or lose it” tax breaks:
- This year's £11,520 Individual Savings Account (Isa) is about to expire. You can put anything from £1 to £5,760 into a cash Isa with the balance (or the total sum) into a stocks and shares Isa. Some banks, financial advisers and investment groups will stay open until midnight on April 5 – it's a Saturday this year. But others won't, so you may need to act well ahead, especially if you are a new customer. Isas are free of income and capital gains tax and do not need to be reported on tax forms.
- It's your last chance to give £3,000 away without worrying about inheritance tax. Because you can go back one tax year, this applies to 2012-13 as well, so you can add this year's £3,000 (a sum unchanged in 30 years) to make £6,000 – or £12,000 for a couple.
- It's your last opportunity to use this year's £10,900 capital gains tax allowance.
May 1. Fines ratchet up at £10 for up to 90 days if you haven't filed your tax return. That's a maximum £900 to add to the previous £100. July 6. The final date for employers to issue form P11D – showing employees the value of taxable perks such as company cars, health insurance plans or “flexi-benefits” schemes.
July 31. The deadline for the second half yearly self-assessment payment. You may be exempt if you owe less than £1,000 or if at least 80% of your total tax due is deducted at source by your employer or savings institution.It's also the final day to renew child tax credits if you have been sent an “annual declaration” - a form where you tell HMRC of your circumstances. This is for “reply required” cases and this means what it says. If you are not sent an “annual declaration” (known as “auto-renewal”) then you can skip this.
August 1. More fines for those now six months late with tax payments. There's a further 5 per cent of the amount due or £300 – whichever is the greater. There is a further timetable with more five per cents plus 3 per cent interest which kicks in after this for really serious arrears.
October 31. The deadline for filing self assessment paper forms. If you choose this rather than online – around 15 per cent or 1.6m use paper – and it arrives late, you can face a £100 penalty even though online taxpayers have a further three months. The good news is that you don't have to pay until January 31.
December 30. If your self assessment shows you owe £3,000 or less, and you have regular Pay as You Earn tax deductions, you can choose to have the outstanding sum divided by 12 and added to your monthly tax via a PAYE code.
December 31. Relax and enjoy New Year's Eve!