Martin Lewis Issues Tax Return Warning

With the tax return self-assessment deadline rapidly approaching thousands of UK taxpayers have to race against the clock to avoid tax penalties. Expert in consumer finance Martin Lewis has issued a dire caution: missing the 31 January deadline triggers the PS100 penalty however, in certain circumstances, two key words could allow taxpayers to save themselves from the penalty.

According to Lewis the taxpayers who fail to meet the deadline because of genuine or unavoidable reasons may be able to successfully appeal by proving they had a “reasonable excuse.” Although HMRC penalties are sever but the system also allows the possibility of discretion in cases where real-life events cause compliance to be impossible.

The deadline for tax returns that self-assess is January 31st. It is applicable to:

Self-employed people
Sole traders making more than PS1,000
Business partners
Landlords
Anyone HMRC has contacted to file a tax return

In the event of a missed deadline, you will be subject to automatically imposed penalties regardless whether you owe taxes or not.

Martin Lewis Issues Tax Return Warning Overview

Time After Deadline	Penalty
1 day late	PS100 automatic fine
3 months late	PS10 per day (up to PS300)
6 months late	5percent of the tax due (or PS300 (whichever is the greater)
12 months late	Additional 5% or PS300
Interest	7.75 percent annually (charged daily)
Official Website	https://www.gov.uk/

If you do plan appealing, your fine will be initially imposed before the appeal is granted after.

Tax Return Warning

Martin Lewis highlights that HMRC permits penalties to be cancelled when you have the existence of a “reasonable excuse.” This is a crucial phrase and must be clearly stated when appealing.

A reasonable excuse is an event that was outside of your control which prevented you from filing your tax return on time. HMRC advice — which is cited in the work of Lewis via his BBC platforms provides proof that appeals are able to succeed if justification is based on valid reasons and filed on time.

What Counts as a “Reasonable Excuse” According to HMRC?

HMRC accepts various scenarios as legitimate excuses for tax evasion, including:

The death of a partner or a family member close to the time of the deadline
Life-threatening or serious disease
Hospitalization for unexpected reasons
Conditions of mental health or disabilities
Flood, fire or theft that affects records
HMRC website is down or has technical issues
Computer or software malfunctions
Unpredictable postal delays
A third person (accountant/agent) not submitting
A serious misinterpretation of tax obligations

It is important to note that HMRC requires you to submit a tax return within a few days after the issue is solved. If you delay too long, it could cause the excuse to be invalidated.

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Interest Charges Still Apply – Even If the Fine Is Waived

Even even if HMRC accepts to end the PS100 penalty, interest on unpaid tax will not be automatically eliminated.

Current rate of interest: 7.75% annually
Percentage charged each day for tax unpaid and penalties
Keeps going until balance is completely paid.

This is the reason Martin Lewis advises paying any tax due in the earliest time possible regardless of whether your tax return is due or is under appeal.

How to Appeal an HMRC Late Filing Penalty

If you receive a penalty notice, act quickly. Appeals are usually filed in the first the period of 30 days.

Step-by-Step Appeal Process

File your tax return immediately
Online appeals can be made via HMRC or post
Be clear about what you did with a “reasonable excuse”
Explain briefly what occurred and how it happened.
Include additional details, if they are available.
Make the appeal in 30 days from the date of the notice.

In the event that HMRC will accept your reason If HMRC accepts your explanation, you will be able to claim the PS100 fine will be canceled.

When Appeals Are Commonly Rejected?

HMRC can deny an appeal in the event that:

The excuse was retracted way before the deadline.
You waited unreasonably long when the issue was resolved.
A lack of explanation is not clear.
You have ignored HMRC notifications without a reason.

Speed and clarity greatly increase your chances.

What If You’re Struggling to File?

If personal circumstances make filing difficult:

For help, ask a reliable family member, or a friend to help you.
Speak to for a tax advisor or an accountant
Make use of the HMRC’s self-assessment online helpline
Make an initial initial return and then make any changes as needed

HMRC recognizes that emergencies can occur, but they want taxpayers to behave prudently once they’re competent.

Why Martin Lewis Says Don’t Ignore the Problem

Martin Lewis stresses that ignoring HMRC letters could quickly make the PS100 penalty into thousands or hundreds of dollars in interest and penalties.

Utilizing the term “reasonable excuse” will not guarantee success, however it does provide you with an avenue to contest sanctions when life really hinders your progress.

The self-assessment deadline is often missed and can cost you money, however HMRC will allow for flexibility in cases where real hardship is the case. According to Martin Lewis explains, knowing your rights and resolving them quickly could save you money as well as stress.

If circumstances have actually kept you from submitting your tax return on time, two words -an excuse that is an excuse that is reasonable could be an enormous difference.

FAQ’s

Q1. What are the two words that could waive the PS100 HMRC fine?

The terms are “reasonable excuse.” Making them clear in an appeal may aid in reversing the fine if the circumstances are suitable.

Q2. Can HMRC cancel penalties automatically?

No. You have to file your appeal within 30 days of the date you receive it and explain your circumstances. Fines are initially issued followed by a review.