ACCA: Accountants and SMEs at breaking point as HMRC urged to delay self-assessment deadline
Accountants are dismayed that HMRC is refusing to extend the deadline for self-assessment tax returns on January 31, which could land millions of hard-hit entrepreneurs with fines totalling £250 million.
The Association of Chartered Certified Accountants (ACCA) has lobbied HMRC for a rethink on behalf of its members and the businesses they support. However, so far HMRC insist the £100 fines will be issued and then the ordinary appeals process followed.
Glenn Collins, head of technical advisory and policy, wrote to HMRC, highlighting: “Given the fact that we now have a further national lockdown, the results from our latest survey post the lockdown announcement, the increased need for individuals to isolate, and the worsening response times to queries raised with HMRC, we would urge HMRC to reconsider and extend the deadline until the end of the tax year in order to provide relief for struggling businesses.”
ACCA members highlighted several areas where the pandemic has intensified familiar filing deadline difficulties, as well as introducing new ones.
Richard Halsey, of Halsey and Co in Cheam, Surrey, added: ‘“We now have to spend on average three days trying to reach HMRC on webchat just to make contact as our letters and calls go unanswered. That is one of the main reasons we are behind in filing – my staff are simply having to spend disproportionate amounts of time dealing with HMRC issues and assisting with the various government Covid schemes.”
Another ACCA member, who practices in Bath, said: “We had made resource plans for the extra self-assessment work to be done in January but following the announcement of the lockdown it will now be very difficult to meet the tax return deadline for all clients along with the increased workload for furlough claims etc.
“We have a number of staff that will need to deal with childcare as a consequence of schools being closed, so we have fewer resources available for January than planned.”
Damian Thomas, of DJ Thomas & Co accountants, of Gloucester, commented: “Given the new lockdown measures, I will be unable to collect the necessary information from certain elderly clients that need my assistance at their homes.”
The current ramping up of pressures comes at the end of what has been an unprecedented year for accountants, as they have had to support clients with a wide range of entirely new measures, including the Coronavirus Job Retention Scheme (CJRS), Self Employed Income Support Scheme (SEISS) and Local Restrictions Support Grant (LRSG), as well as advise those who have received no government support and try to manage the impact of the pandemic on their own staff and businesses.
As Damian Thomas explained: “Since the pandemic, my workload has increased immensely, and that is the same for all the other accountants that I have spoken to. I have no chance whatsoever of being able to submit on time the 2020 Tax Returns for a significant number of my clients.
“I expect to have about 40 clients for whom I will be unable to complete on time, whereas usually I’ll only have a handful of clients who have left it too late.”
The letter from ACCA went on to share the statistical results of the survey of accountants representing 14,000 clients, which discovered that “22.2% of clients were expected to miss the filing deadline. Extrapolated across the 11.7m self-employed individuals required to file in 2020 this could mean around 2.5m entrepreneurs facing penalties”.