Lowest-paid self-employed workers twice as likely to miss tax return deadline, data finds

HMRC data has revealed that self-employed workers on the lowest incomes are significantly more likely to miss the Self Assessment filing deadline than higher earners, with late filing rates nearly double those of additional and higher rate taxpayers.

The figures, obtained through a Freedom of Information (FoI) request submitted by PensionBee, cover tax years from 2019/20 to 2023/24.

In the most recent year, 5.9% of self-employed people earning below the basic rate tax threshold filed their tax return after the 31st January deadline.

This compared with 3.1% of basic rate taxpayers, 2.7% of higher rate taxpayers and 2.6% of additional rate taxpayers.

The pattern remained consistent across all five years of data, including during the pandemic years when HMRC temporarily waived late filing penalties for returns submitted before 28th February.

Overall, around 180,000 self-employed individuals filed late in 2023/24, although total late filing numbers have gradually fallen in recent years.

HMRC data showed that 94% of those filing late were either below basic rate or basic rate taxpayers.

PensionBee said the findings point to a wider knowledge and support gap among lower-income self-employed workers, many of whom manage their finances without accountants or advisers and face greater income volatility.