More than 12 million people are expected to file a tax return for the 2024–25 tax year. As 2026 begins, 6.36 million have already got their tax affairs in order and submitted a return. New Year’s Eve and New Year’s Day proved popular for ticking off this task, with 54,053 people filing over those two days alone – including 342 filed in the final hour of 2025.
However, 5.65 million taxpayers are yet to file. With less than a month remaining before the 31 January deadline, it is important to act now to avoid penalties and interest.
Last year, over 11.5 million taxpayers – around 90.5% of those expected – met the 31 January deadline, but this still left a significant minority struggling to file on time. Filing ahead of the deadline makes the process more manageable, ensuring there is time to organise finances and explore payment options.
Why submitting now matters
Once you submit your tax return, your final tax position is confirmed and you can review your payment arrangements, including paying in instalments through Time to Pay. HMRC needs to know your exact tax liability before setting up a payment plan, so you must file your return before applying online for Time to Pay.
Filing after the deadline can result in penalties, starting with a £100 fixed fine – even if no tax is owed – with further charges applied at 3, 6 and 12 months. Paying on time also helps you avoid interest, which starts to accrue from the day after the deadline.
What is Time to Pay?
If you cannot pay your Self Assessment bill in full by 31 January 2026, you may be able to set up a Time to Pay arrangement, allowing the balance to be spread across monthly instalments. These arrangements can cover all outstanding amounts, including any penalties and interest.
For tax bills of up to £30,000, most people can set up a Time to Pay arrangement online, without the need to contact HMRC. For bills larger than this, you can still apply but will need to contact HMRC directly.
Time to Pay arrangements must be set up directly by the taxpayer, so M+A Partners cannot complete this online on your behalf. You can set up your payment plan online here at GOV.UK and you will need your Government Gateway ID to do so.
How the payment plan is worked out
HMRC bases the repayment schedule on what you can reasonably afford, using an income-and-expenditure review. In most cases, individuals are not expected to pay more than 50% of their disposable income each month. HMRC will approve a Time to Pay arrangement only if it is confident that the full tax liability will be repaid.
There is no fixed maximum length for a plan – it depends on the amount owed and financial circumstances.
Be fraud aware
Self Assessment taxpayers may be more vulnerable to fraud and should never share their HMRC login credentials with anyone.
Scammers are constantly looking for ways to trick taxpayers into giving away personal or financial information, often contacting people by email, phone, or text while pretending to be HMRC.
Remember, HMRC will never ask for payment in unusual ways, threaten immediate legal action over the phone, or request personal information via email or text. Staying vigilant is the best way to protect yourself.
Something to note
The new High Income Child Benefit Charge (HICBC) PAYE digital service means that thousands of Child Benefit claimants who are in Self Assessment solely to pay HICBC can now opt out of Self Assessment and instead have the charge collected through their tax code. This makes managing the payment simpler and removes the need for a separate tax return just for the charge.
How M+A Partners can help
Our team of tax experts can handle your Self Assessment return, maximise available reliefs, and manage any HMRC enquiries on your behalf. We can also review your payments on account to see if they can be reduced for the next year.
Contact us today to get personalised advice and support, ensuring your tax affairs are managed efficiently.
