1m set to miss tax deadline

THE Government is set to rake in almost £100m in fines after it emerged that around 1m taxpayers will fail to get their tax returns in on time. The final deadline for self-assessment forms to be sent back to the taxman is 31 January.

In practice, anyone whose return arrives in the morning post on 1 February will also escape the automatic £100 penalty for late submission. But large numbers of people will miss the deadline, tax advisers say.

Taxpayers also face interest on any unpaid tax and the Revenue has the right to levy daily charges of £60 on seriously late returns.

This year the Revenue has heavily promoted its online filing system and TV presenter Adam Hart-Davis has been appearing to promote the self-assessment system. But there are signs that some taxpayers have been prevented from completing their forms due to technical problems on the website.

Dozens of This is Money readers have written in to complain that the tax website has 'seized' and 'crashed', preventing them from getting their tax return through online. The Inland Revenue said that website problems were caused by the numbers of people trying to use it at the last minute and would not be accepted as a valid excuse for anyone who misses the deadline.

An Inland Revenue spokesman said: 'The system hasn't crashed as we have been receiving returns throughout the weekend. But some people have been experiencing difficulty getting through because this is the busiest weekend of the year. We have increased the bandwidth to cope with very heavy traffic.'

{1} He admitted that it was 'a possibility' that people could miss tonight's midnight deadline. Late filers usually face an automatic penalty of £100. He also conceded that the acknowledgement messages were taking longer than usual and in some cases were not being generated until the day after a return had been received.

However, the spokesman added: 'People have had since April to file their returns. The service is available throughout the tax year so the moral is don't leave it until the last minute to file your return, either electronically or the paper version.'

Meanwhile, union leaders say that proposed job cuts at the Inland Revenue could lead to large numbers of errors and delays in dealing with tax returns in future years. Within sight of the deadline for returning self-assessment forms, the Public and Commercial Services union (PCS) said the Government could be storing up trouble by slashing 10,000 revenue jobs as part of a huge civil service cutback.

The Inland Revenue is to merge with Customs and Excise under plans to cut more than 100,000 jobs in the civil service over the next few years.

PCS national officer Frank Campbell said: 'Over the coming weeks we will begin to see just where the axe will fall in the Inland Revenue and Customs. Our fear is that this could be the last self-assessment deadline to pass off without a hitch. As jobs are cut, together with the possibility of local tax offices closing, it will become harder for people to get the correct tax advice in order to file their returns on time.

'The effect will be more errors and delays. Rather than cutting staff the department should be looking to expand services to the community and invest in initiatives that will close the 'tax gap' and bring fairness for honest taxpayers.'