Research by consumer group Which? has revealed that Britons will spend a total of 19 million hours on their tax returns this year.
The survey of 4,000 adults also found that only three respondents were able to give the correct answer to seven questions about general tax rules —with 10% of people reportedly taking over five hours to complete their tax return.
Tax returns are due to be submitted by January 31, and failure to do so results in an instant £100 fine, with additional penalties issued—depending on how late the tax return is filed and the amount owed.
With over 12 million Brits required to submit a tax return before the end of this month, the survey highlights the nation’s poor understanding of tax-related issues. This year, the added pressures of home-schooling, or self-isolating and other COVID-19 related issues have resulted in HMRC confirming it will accept late returns without penalties this year.
However, workers must be able to prove that a late submission was directly due to the pandemic, otherwise, the fees will not be waived.
Chancellor Rishi Sunak is also rumoured to be contemplating an extension to the deadline for all those who need to complete a tax return. This is yet to be confirmed, but it is expected that those affected will have to submit a form stating the reasons for their late submission.
“We want to encourage as many people as possible to file on time even if they can’t pay their tax straight away,” HMRC said in a recent statement.
“But where a customer is unable to do so because of the impact of Covid-19, we will accept they have a reasonable excuse and cancel penalties, provided they manage to file as soon as possible after that.”
In 2020, 11.1 million people filed their return on time, but more than 70,000 of these were submitted on deadline day, with almost 27,000 Brits completing their returns in the final hour.
“This month, we’ve hit peak tax return prevarication,” says Sarah Coles, personal finance analyst for Hargreaves Lansdown. “Hundreds of thousands of people put this nasty job off every January, but this year more than ever, it’s easy to see why so many people can’t bear to get started.
“Many self-employed people are so worried about their potential bill that they can’t face doing the calculations. Meanwhile, others are so busy juggling running a business with the stress of lockdown, that the extra faff is the last thing they need.
“The taxman has confirmed that those hit by the virus can put off doing their return without facing a fine. In some cases, this will be a lifeline for people who are overwhelmed. However, if you’re able to complete the paperwork in time, you need to do so.”