In our blog post last month we said:
This year, it is likely that there will be far more unfiled SA returns than in previous years. Perhaps common-sense will prevail. HMRC may not be willing to endorse a blanket extension of the 31 January deadline, but they could cancel the initial, automatic £100 fine for 2019-20. This or a similar option would be far more effective than offering professionals a facility to appeal on behalf of multiple clients in one process.
Were HMRC listening?
Whilst the £100 late filing penalty was not cancelled it has been deferred until 28 February providing practitioners and stressed clients with an extra month to file their 2019-20 SA return.
Predictions for the next month
What can we expect?
Rishi Sunak seems to be keen to recover his COVID support borrowings by increasing taxation, but is this likely when we are in the midst of lock-down and its depressing effects on economic activity? Will he want to remove cash from consumers purses or business bank accounts while we are still battling to control COVID infection? Unlikely…
What is possible is an extension of the furlough scheme beyond 30 April – to protect jobs – and perhaps an equivalent extension to the Self Employed Income Support Scheme? Our guess is a further quarter to 31 July at perhaps 60% rather than an 80% support level.
If tax increases are mentioned they will probably be sign-posted for action in 2022-23.
He may also flag a number of consultations, increases in Corporation Tax, alignment of CGT with Income Tax and reduction in tax relief for pension contributions.
In this way we will be softened up and should probably accept that when the coming consumer-fest begins – as lock-down restrictions are lifted – increases in tax are inevitable, if, as Sunak appears to believe, reducing COVID borrowings is imperative and the way to do this is via increases in taxation.
We all wait with bated breath…