“UK law HMRC” by Patrick Cannon is licenced under CC BY 2.0.
This has led His Majesty’s Revenue and Customs (HMRC) to intensify pressure on late submitters – by increasing the interest rate on late payments of tax owed.
As of 6 April 2025, the rate will increase by 1.5%, bringing it to approximately 9%.
Here, we provide tips and strategies from HMRC and Anita Rasheva, founder, AD Accounting and Business Solutions, to help accountants ensure that their clients meet the deadline.
Who must meet the self-assessment tax return deadline?
HMRC’s website makes clear which entities must meet the self-assessment tax return deadline.
They include anyone who, in the previous tax year (6 April 2023-5 April 2024):
- Was a sole trader that earned more than £1000;
- Was a partner in a business partnership;
- Had a total taxable income of more than £150,000;
- Had to pay capital gains tax after selling something that increased in value;
- Had to pay the high income child benefit charge; or
- Earned any untaxed income.
HMRC estimates that around 12 million people fit into these categories.
Anyone who is unsure of whether they qualify can use HMRC’s online tool to find out.
How taxpayers are responding to the looming deadline
As of 6 January 2025, 5.4 million people were yet to submit their self-assessment tax return.
However, some seized upon the new year to turn over a new leaf.
24,800 filed on New Year’s Day, and 38,000 on New Year’s Eve – including 310 who filed between 11pm and 11:59pm.
“We know completing your tax return isn’t the most exciting item on your New Year to-do list, but it’s important to file and pay on time to avoid penalties or being charged interest,” said Myrtle Lloyd, HMRC’s Director General for Customer Services, in a media statement.
What are the penalties for missing the deadline?
Anyone who misses the deadline must pay £100. This applies whether tax is owed, and whether this tax is paid on time.
Those who miss the deadline by more than three months must pay additional penalties, as follows:
- After three months, £10 per day up to £900;
- After six months, 5% of the tax owed or £300 (whichever is greater); and
- After 12 months, another 5% of the tax owed or £300 (whichever is greater).
For any tax unpaid by the deadline, further penalties apply. These are interest on the amount owed, plus 5% of that amount at 30 days, six months and 12 months past the deadline.
Strategies for small businesses to meet the deadline: a change in mindset and consistent record-keeping
For many business owners, meeting the deadline can feel like yet another onerous administrative task.
That’s why Rasheva recommends a change in mindset.
“Ensuring timely submissions is not just about avoiding penalties – it’s about building financial discipline and fostering trust with stakeholders,” she said.
In recognising this, businesses should swap last-minute tax returns for a pro-active approach.
The first step is avoiding the pitfall of inconsistent record keeping.
“Begin by organising all financial records, including invoices and receipts, bank statements, and, if applicable, payroll records.”
Accountants should encourage clients to use cloud-based accounting software, such as Xero, Quickbooks or Sage. This reduces human error, while providing real-time updates for business owners and accountants.
“Ensuring timely submissions is not just about avoiding penalties – it’s about building financial discipline and fostering trust with stakeholders.”
Anita Rasheva, founder, AD Accounting and Business Solutions
Understanding tax liabilities early
Once a business has its record keeping in order, the next step is to understand all tax liabilities – as early as possible.
“Self-assessment tax returns aren’t just about reporting income; they’re about understanding your overall tax position,” Rasheva said.
This requires adding up income from all sources, such as side businesses and investments, then deducting all relevant expenses, such as the costs of operating, travelling, professional memberships, donations to charities and pension contributions.
Also essential for the best outcome is determining opportunities for tax relief, such as capital allowances and carry-forward losses.
Gathering the information needed to submit a self-assessment tax return
To avoid delays, which could result in a late submission, it’s essential to gather all necessary information well before the deadline.
Every business needs:
- A Government Gateway account, which can be set up online;
- A ten-digit Unique Taxpayer Reference (UTR), which HMRC provides when a business registers for self-assessment;
- A National Insurance (NI) number;
- Records of all untaxed income;
- Records, such as P60 records, of income that was taxed during the financial year;
- Records of tax deductible expenses; and
- Records of contributions to charities or pensions.
Downloading the HMRC app
One of the easiest ways to gather this information – and complete a variety of other tasks – is using the HMRC app.
Established businesses can use it for a variety of tasks, including checking their UTR, NI, and employment and income history, and tax credits.
New businesses can use it to register for self-assessment, which should have been done by 5 October 2024.
In addition, once a business has filed its return, any tax owed can be paid directly through the app.
How accountants can help their clients meet the deadline: financial forecasting
“Engaging an accountant isn’t just a safety net; it’s an investment,” Rasheva said.
“Accountants bring a strategic perspective to self-assessment by identifying potential issues before submission, advising on tax planning for the next financial year and representing their clients in case of HMRC inquiries.”
One of the most effective ways that accountants can help small businesses to prepare for deadline is financial forecasting.
“[Accountants can] use forecasting tools to help clients understand their future tax liabilities,” Rasheva said.
This might include:
- identifying patterns in cash flow to plan quarterly tax instalments;
- modelling various income scenarios to prepare for variable tax rates; and
- finding opportunities for adjustments, such as deferring income or increasing deductible expenses.
Bringing tax strategies into budgeting
Further, accountants should encourage their clients to consider tax strategies when budgeting.
“This approach ensures funds are set aside for tax liabilities and avoids surprises that could disrupt cash flow, which, together, build financial resilience,” Rasheva said.
“[It might include providing] clients with regular reports, and encouraging a culture of quarterly or monthly reviews to [help clients] stay on top of their financial goals.”
Driving efficiency through automation
Given that most small business owners find administration tedious and time consuming, automation can reduce the burden.
While this might require an upfront investment, it can save time and money in the long run.
“Key benefits include providing immediate access to shared documents, [which reduces] back-and-forth communications, and [allowing] real-time collaboration with clients,” Rasheva said.
“Some software can [even] streamline the self-assessment process, enabling accountants to focus on strategic advisory, rather than manual data entry.”
Why meeting the self-assessment tax return deadline matters (beyond compliance)
“The self-assessment process is more than an administrative task,” Rasheva said.
“For small businesses, it’s an opportunity to gain clarity on financial health, identify growth opportunities and build a solid foundation for long-term success.
“For accountants, it’s a chance to showcase expertise, drive value and solidify client relationships through proactive and strategic financial guidance.”
