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Many businesses unaware of May 19 tax return deadline

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Almost a third of businesses in the UK (28%) are unaware of the May 19th deadline for submitting their payroll year end tax returns. The survey of 1,368 businesses, conducted by You Gov on behalf of Sage (UK) Limited, suggests that businesses could be risking a potential fine of £100 if they submit after the deadline, but ultimately they need more information and guidance about submitting their tax returns, including the option of submitting online.

These results suggest that a lack of awareness around online submissions is impacting the numbers currently submitting payroll year end tax returns online. A third admitted that they had never submitted online, and the situation does not look likely to improve ahead of this year’s deadline either. Of the 32% (520,000 businesses) that do not currently submit online, only 28% plan to do so this year.

The survey also shows that there could be implications for those that fail to submit online in the future. A quarter of UK businesses were unaware that in 2010 it will be compulsory for all businesses to submit their payroll year end returns online.

Currently, only businesses of 50 employees and above have a legal requirement to submit their payroll year end tax returns online. Businesses that have between 1 and 49 employees have until 2010 before the process becomes mandatory. However a tax-free payment of £150 is given if they do choose to submit online before the May 19th deadline this year and a further £175 is available over the next two filing years.

Jo Ray, Managing Director, Sage (UK) Limited Small Business Division comments, “The number of businesses that are unaware of the tax deadlines is higher than we expected. We feel that much of the problem is down to a lack of awareness and understanding about submitting payroll year end online.

"Businesses obviously have a need for more information, and at Sage we pro-actively communicate with all of our payroll customers to make sure they are aware of when the deadlines are. As such, we have seen a huge upturn in the number of our customers who now submit online, quickly and effectively.”

More support required for those that submit online

The survey showed that one in five businesses have experienced difficulties when submitting their business’ payroll year end returns online, of which:

• 48% said the system crashed
• 44% have had to file out of office hours, and a fifth of those said that it had impacted their business in some way

Jo Ray continues, “There are still some areas to address when it comes to online submissions, and care must be taken to ensure that the process is as easy as possible for businesses of all sizes, and that lives are made easier because of it.”

Furthermore, one in five small businesses also commented that they felt the Government could do more to support them. This included a more ‘customer-focused’ approach to support (27%), a dedicated helpline (24%) and more information ahead of the deadline (24%). Finally, almost a third of those who currently submit online felt that the Government tax incentives were not enough.

Zoe Walsh, associate at TPH Accountants and a Sage accountant in practice advises, “Those businesses who currently do not submit their tax returns online should look to take the time to investigate just how much they can save before the 2010 deadline, or risk facing a fine when the process becomes mandatory. We have been filing tax returns online for over three years, and despite teething problems in the past, the system is very easy to use, which ultimately saves businesses time and money.”

For those seeking advice about online payroll year end submissions, click here.

Posted May 18, 2007