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    Tag: tax bill

    1 million people missed the Self Assessment tax return deadline

    Posted on by Rebecca Campbell

    According to HMRC, 1 million taxpayers missed the 31 January 2026 deadline for submitting their 2024/25 income tax Self Assessment.

    If you’re one of those who has yet to submit your tax return, don’t delay! We recommend submitting your Self Assessment as soon as possible. Here’s what you need to know:

    Penalties for late filing

    • Immediate penalty: £100 fixed penalty, even if no tax is owed
    • 3 months late: £10 per day (up to a maximum of £900)
    • 6 months late: Additional penalty of 5% of tax due or £300 (whichever is greater)
    • 12 months late: Another 5% penalty on tax still owed

    If you can’t pay your tax bill

    If you’re unable to pay your tax bill, engaging with HMRC and a trusted tax adviser as early as possible is crucial – early engagement gives you the best chance of mitigating any financial penalties. Options such as ‘time to pay’ arrangements may help you avoid additional penalties, although late payment interest will still accrue.

    Take action now

    If you’ve yet to submit your 2024/25 tax return and need help or advice to minimise penalties, please speak with your usual PM+M adviser or email us at enquiries@pmm.co.uk.

     

    HMRC issues tax warning letters to savers

    Posted on by Rebecca Campbell

    If you’ve earned interest on your savings recently, you may receive a letter from HMRC about a potential tax bill. With high interest rates and frozen personal savings allowances, it’s estimated that over a million additional savers could now be caught in the tax net.

    Will I receive a letter from HMRC?

    Each year, HMRC reviews savings data reported by banks and building societies. If your savings interest exceeds your tax-free Personal Savings Allowance (PSA) — £1,000 for basic rate taxpayers, £500 for higher rate, and £0 for additional rate taxpayers — you may receive a tax calculation letter.

    These letters are not sent at random. They’re part of HMRC’s routine checks to ensure individuals are paying the correct amount of tax. However, it’s important to note – even if you don’t receive a letter, you are still responsible for any tax owed — and HMRC encourages you to get in touch if you think something may have been missed to avoid potential penalties.

    I’ve received a letter from HMRC – what should I do?

    1. Don’t panic – A letter doesn’t necessarily mean a large bill, but it does require attention.
    2. Check the details – Review how much interest you earned and compare it to your allowance.
    3. Respond promptly – If you disagree with the figures or need to make corrections, contact HMRC as soon as possible.
    4. Plan for tax deductions – If you’re employed, HMRC may adjust your tax code to recover the amount through PAYE, affecting your monthly take-home pay.

    Why is this happening now?

    Interest rates on some savings accounts have reached 5–6%, making it much easier to exceed the PSA. As a result, many savers who’ve previously not had to worry about tax on their interest income are now facing unexpected bills — especially those not in the Self Assessment system.

    Looking ahead

    Forecasts suggest over 2 million people could face a savings tax bill from HMRC in the 2024–25 tax year — a significant rise from previous years. It’s more important than ever to be aware of how much interest you’re earning and understand your potential tax liability.

    Get in touch

    If you’ve received a letter from HMRC and are unsure of next steps — or simply want to understand how this could affect you — we’re here to help. Get in touch at enquiries@pmm.co.uk to discuss your situation in more detail.