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More than 40,000 people completed their self-assessment tax return between Christmas Eve and Boxing Day, HM Revenue & Customs data shows.
During the same three-day period last year, 25,769 people lodged their returns, HMRC added, a 55 per cent increase over this festive period.
More than 4,400 taxpayers filed their tax return online on Christmas Day, which is a slight decrease from last year’s figure of 4,757.
Between 3pm and 4pm proved to be the most popular time to file self-assessment tax returns online on Christmas Day, with 368 people filing between these times.
According to HMRC, 11,932 people filed their tax return on Boxing Day, with the most popular time being 4pm to 5pm, and 1,108 filed during this period.
More than 23,700 people submitted their applications on Christmas Eve instead of doing last-minute shopping and wrapping. The most popular time was from 11am to midday, when 3,458 lodged their tax return, HMRC said.
Self-assessment: You must pay the tax you owe before midnight on January 31, 2025
Personal finances have been in the spotlight this year, and the Autumn Budget is weighing heavily on Brits’ minds.
Self-assessment taxpayers have until 31 January 2025 to file their return online and pay the tax they owe to HMRC. For paper returns, the deadline was October 31, 2024.
Anyone who files their tax return before December 30 may have the option to pay any tax due through their PAYE tax code.
Myrtle Lloyd, HMRC’s director general of customer services, said: “People who need to lodge a self-assessment return and have already done so can enjoy the rest of the festive period knowing they have it ready for another year and can enjoy singing Auld Lang Syne knows his fiscal affairs are in order.
‘For those who haven’t started yet, our online service is available 365 days a year, so there’s still a chance to get started before the end of 2024. Go to Gov.uk and search for ‘self-assessment’ to access the online help and get started today.’
Five tips to help you with your tax planning
Together with Charlene Young, pensions and savings expert at AJ Bell, This is Money outlines five ways to get your self-assessment tax affairs in order and avoid HMRC penalties.
1. Verify that you need to file a tax return
Even if you think you have nothing to pay, you may still need to file a return for the tax year or you could face fines. These start with a one-off fee of £100, and you have to pay more if you are more than three months late.
Circumstances that require a tax return include being self-employed and earning more than £1,000, paying capital gains tax on something you sold or transferred for a profit, paying the high-income child benefit charge or being a partner in a company.
You must also file a return if you had income over £150,000 in the last tax year.
Even if none of the above applies to you, you may still need to file a tax return if you have received more than £1,000 returns from savings and investments in the tax year.
2. Organize your account statements
Your savings and investment providers should have sent you a summary or annual statement after April 5 detailing what you earned with them during the tax year, as well as details of the gains or losses on any investments you sold during that time.
You should check your savings and investment income, i.e. interest and dividends, as well as any profits you have made from selling investments outside of Isas or private pensions.
You will pay tax on the interest earned on your cash savings that exceeds the personal savings allowance, which currently stands at £1,000 for basic rate taxpayers and £500 for higher rate taxpayers.
Additional rate taxpayers get no exemption and pay tax on all cash interest they receive outside of a tax shelter.
HMRC will check what you have declared on your tax return against the information sent to them by your bank or building society, and any tax already collected through an adjustment to the tax code that year.
The tax-free allowance for dividend income fell again in 2023/24, to just £1,000 for the tax year. In previous years it was as high as £5,000 a year, but cuts to the allowance mean millions more people are now caught in the dividend tax net.
You will pay taxes on dividends above the allocation at 8.75 percent, 33.75 percent or 39.35 percent, depending on your other income.
For the current tax year, 6 April 2024 to 5 April 2025, the dividend tax threshold is just £500.
For capital gains returns, although changes to CGT were announced in this year’s Budget, gains made when investments were sold or transferred in the last tax year will continue to be taxed at the previous lower rates of 10 per cent or 20 percent, depending on your other income that year.
3. Request tax relief on pensions
Anyone who paid into a self-invested personal pension between April 6, 2023 and April 5, 2024 would have automatically received a 20 per cent base rate reduction.
This adds an automatic top-up to pension contributions, meaning that, for example, a personal contribution of £2,000 would automatically be increased by £500 to £2,500.
However, higher rate taxpayers must claim the additional £500 tax relief they are owed by HMRC.
An additional rate taxpayer could claim 25 per cent tax relief from HMRC on top of the 20 per cent relief they automatically receive.
Ms Young, of AJ Bell, said: ‘Many people do not realize that they need to claim pension tax relief, especially as it is only necessary with some types of pension schemes, but not others.
“If you are contributing to a ‘take home’ pension scheme, your contributions will be deducted from your salary before tax, meaning income tax relief is usually paid automatically.”
4. Beware of the child benefit tax trap
The thresholds for recovering child benefits are higher now, but in 2023/24 taxpayers with children should be aware of the old rates.
Child benefit for 2023/24 will be phased out once you or your partner earns more than £50,000. The benefit stops completely once £60,000 is reached.
If you need to repay some or all of your child benefit payments for that year and your tax code has not yet been adjusted to take this into account, you will need to repay it through a self-assessment.
Those who fail to do so will be caught up by HMRC and may incur an additional penalty as a result.
5. Don’t forget to pay the tax itself.
Regardless of when you file your tax return, make sure you have paid what you owe by midnight on January 31, 2025.
If you do not do this, you will begin to accrue daily interest from February 1. The annual interest rate charged by HMRC is substantial, at 7.25 per cent.
If you are struggling to pay, you may be able to agree a payment plan online with HMRC, provided you owe £30,000 or less.
In addition to paying the correct amount of tax in the self-assessment return, it is also necessary to take into account payments on account.
Payments on account are tax payments made twice a year by self-employed taxpayers who carry out their self-assessment to distribute the cost of the following year’s tax. They can be substantial.
You can request a reduction in your interim payments for next year if you think your income will be significantly lower than before.
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