Late Tax Filers Catch a Break in the U.K.

The end of January is usually crunch time for British taxpayers.

This year, they got a bit of breathing room.

Less than a week before the Jan. 31 deadline to file taxes online, the U.K. Treasury said Monday that it won’t fine people who file their digital returns by Feb. 28.

Taxpayers are still “obliged” to pay whatever they owe by the end of January — and they will be charged interest past that date. Still, they won’t face the usual fine of £100 ($136) if they wait a month.

“We recognize the immense pressure that many people are facing in these unprecedented times,” the Treasury’s chief executive, Jim Harra, said in a statement. “And it has become increasingly clear that some people will not be able to file their return by 31 January.”

Tax and accounting firms welcomed the break. Yet they expressed frustration about the late notice and urged people who can file to do so by the standard deadline.

“Today’s U-turn is unbelievable,” said Nimesh Shah, chief executive of Blick Rothenberg LLP, a tax and advisory firm in London. “Many taxpayers have already filed their returns and gone to great lengths to do so. We’re very disappointed that HMRC would leave it so late.”

Shah said even if taxpayers manage to avoid a fine, the 2.6% interest rate is expensive and could cancel out the £100 savings from not facing a penalty.

“My message is if you can make the time to file your returns by the 31st of January you should,” he said.

Taxpayers struggling to pay their bills can apply to spread the cost over 12 months using the government’s Time to Pay program. Those payments, however, are also subject to interest.

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