The deadline for the online tax return for self-assessment is approaching – and a survey by Which? The taxpayers found will put together 19 million hours to fill them this year.
The consumer group found that the average time it would take people to complete a return is two and a half hours.
A fifth (20%) of people managed to complete their return in less than an hour, but just under one in ten (9%) took more than five hours.
Which? calculated the number of 19 million hours based on the average length of time and the estimated number of people in the UK completing their own tax returns rather than having a third party do it.
The survey of 4,000 people also found gaps in some tax knowledge.
While a third of the respondents correctly stated that they do not have to pay capital gains tax on the sale of their main residence, around a third received the wrong answer and the remaining third did not know.
Almost half (48%) believed they would not have to file a tax return if their employer automatically deducts tax from their wages through the Pay-as-you-Earn (PAYE) system.
In these circumstances, employees typically don’t need to send a return if their only income comes from their wages. However, they may need to fill out a return if they have any other untaxed income, such as from renting a property.
If someone or their partner’s income is more than £ 50,000 and is receiving child benefit, they may need to send a return and pay the high income child benefit fee.
How To Get Help With Completing A Tax Return – And Scams To Look For
Which? has a “jargon-free” online tax calculator www.which.co.uk/money/tax-calculator and its system enables returns to be sent directly to HM Revenue and Customs (HMRC). Fees of £ 10 for which? Members and £ 46 for non-members apply.
For government guidelines on self-assessment, see www.gov.uk/topic/personal-tax/self-assessment.
According to HMRC, more than 2,700 customers submitted their tax returns for self-assessment on Christmas Day.
HMRC has also warned taxpayers to watch out for fraud and copycat websites.
Customers should ensure they enter the full online address – www.gov.uk/hmrc – to get the right link for your self-assessment tax return online safely and free of charge.
You also need to be vigilant if someone calls, emails or texts claiming to be from HMRC and saying they can get financial help, get a tax refund, or owe tax as it could be a scam .
Late filing usually results in an immediate £ 100 fine, followed by other possible penalties.
Jenny Ross, which one? The money editor said, “As many tackle their tax filings in the coming days, a clear understanding of the tax system will be invaluable and will help thousands avoid mistakes that could prove costly.”
According to HMRC, around 5.4 million self-assessment customers have less than a month to fill out their tax returns.
The tax authority estimates 12.1 million tax returns will be filed this year, and around 55% have already filed their tax returns.
Once clients have completed their tax return and know how much tax they owe, they can create their own payment plan to spread the cost of their tax liability across the £ 30,000 value.
You can use a feature to set up monthly direct debits. From February 1, 2021, interest will be paid on all outstanding amounts, HMRC added.