Frequently asked questions
When do new tax years begin and end?
In the UK the new tax year begins on 6 April and ends on 5 April a year later.
So, 6 April 2019 was the first day of the 2019/20 tax year, while 6 April 2018 was the first day of the 2018/19 tax year (which ended on 5 April 2019).
Changes to new tax rules are often introduced at the beginning of the new tax year (ie. 6 April).
What tax dates are important if I’m self‐employed?
HMRC may fine you for missing a deadline, whether for filing a return late or not paying the money you owe when required. It’s £100 if your tax return is up to three months late – more if it’s later. If you have a reasonable excuse, you can try to appeal a fine.
To help you avoid fines, it’s important to be aware of the following key dates.
Midnight 31 October – Self Assessment tax return deadline for paper returns for the year ended 5 April. HMRC must receive your tax return by this deadline.
Midnight 31 January – Self Assessment tax return filing deadline for online tax returns for the year ended 5 April.
Midnight 31 January – You must pay the income tax you owe by this deadline.
Midnight 31 July – An additional payment deadline for those who make advance payments towards there income tax bills (known as ‘payments on account’).
5 October – If you need to submit a Self Assessment tax return for the first time, you must inform HMRC by 5 October following the tax year in which you started trading.
What deadlines are important for limited companies?
You or your accountant must file your Corporation Tax return, in accordance with HMRC requirements, within 12 months of the company’s year-end, as well as calculate how much Corporation Tax is payable.
Limited companies pay Corporation Tax on their profits minus any reliefs.
A company must pay its Corporation Tax bill within nine months of the end of its accounting period. This is normally the same 12 months as the financial year covered by the company’s annual accounts.
What are the penalties for late filing or late payment?
If you don’t file your Company Tax Return by the deadline, you will have to pay penalties.
If your return is a day late the penalty is £100, plus a further £100 if the return is more than three months late. If your tax return is six months late, HMRC will write telling you how much Corporation Tax they think you must pay. This is called a ‘tax determination’ and you can’t appeal against it.
What deadlines are important if my business is VAT-registered?
When your taxable turnover for the year reaches £85,000 (2019/20 tax year), you must register for VAT with HMRC (most businesses register for VAT online).
You must pay any VAT you charge to HMRC, after filing your VAT returns, which are usually submitted every three months (ie each quarter).
You pay VAT quarterly, and it should say on your VAT certificate which period you fall into. You’re normally given a full month plus a week from the end of your accounting period to complete the VAT return and make your payment.
You can be penalised if HMRC does not receive your VAT return by the deadline (ie one calendar month and seven days after the end of an accounting period).
From April 2019, most businesses are now required to keep digital VAT business records and send returns using Making Tax Digital (MTD) compatible software. The vast majority of businesses will need to do this for VAT periods starting on or after 1 April 2019. Businesses with a taxable turnover below the VAT threshold can also sign up for MTD for VAT voluntarily.
How can I appeal against a penalty?
If you get a penalty you will be sent a notice which will tell you how and what to pay.
Failure to pay a penalty within 30 days will result in interest being charged.
An appeal against a penalty can be made online or via the post, you can appeal if:
- you think the penalty is not due, or
- you think the amount of the penalty is incorrect, or
- you had a reasonable excuse, the HMRC website gives guidance on what is classed as a reasonable excuse.
What is the 2018/19 and 2019/20 Corporation Tax rate?
For the 2018/19 and 2019/20 tax year in the UK, the Corporation Tax rate is 19%.