search
date/time
Lancashire Times
A Voice of the Free Press
frontpagebusinessartscarslifestylefamilytravelsportsscitechnaturefictionCartoons
4:00 AM 19th June 2021
business

Weekend Money: Tax Starts Early For Under-15s

 
Image by Markus Winkler from Pixabay
Image by Markus Winkler from Pixabay
Taxpayers are starting early and continuing to file annual tax returns to HMRC long after the end of most people’s working lives, new data from Handelsbanken Wealth Management shows.

Its Freedom of Information (FOI) request to HMRC found that 7,866 individuals aged 15 or under filed tax returns in the 2019/2020 tax year – part of the 27,845 people aged 18 or under filing returns.

Older taxpayers are even more likely to still be filling in tax returns, the FOI found. More than 1.81 million people aged 65 or over filed tax returns for the 2019/2020 tax year.

That included 47,835 people aged 90 or more – the equivalent of around 8% of all those aged 90-plus in the UK.

Handelsbanken Wealth Management’s FOI request also enquired about late submissions, where people sent in tax returns after the submission deadlines of October 31st last year for paper returns, and January 31st this year for electronic returns. Automatic fines of £100 were waived for late returns received in February, due to the COVID-19 pandemic.

The research found that young and elderly taxpayers were among the best at submitting tax returns on time. Just 135 (7.4%) of the 16-year-olds submitting tax returns missed the deadline, followed by 17-year-olds with just 429 (8.2%) late returns, and 90-year-olds with just 764 (7.2%).

It was the middle-aged who emerged as the most likely to miss the deadline, with 29,180 48-year-olds (10.7%) and 29,143 49-year-olds (10.5%) risking the £100 penalty for late returns.

For the UK as a whole, 1,062,826 late returns were submitted – around 9.4% of the total of 11,270,166 returns. Of the 4,132,329 females who filed a return, 9.2% missed the deadline, compared to 9.7% of the 6,923,456 males.

Mark Collins, Head of Tax at Handelsbanken Wealth Management said: “Whilst it is surprising that so many under-15s need to file tax returns, there are a number of reasons why this may be – including because they are beneficiaries from family trusts and therefore need to file a tax return to reclaim the tax deducted on income distributions made to them, often to pay for school fees.

“The age breakdown provides a fascinating insight into the number of people across the UK who fill in annual returns for HMRC. But with nearly 11.3 million filling in returns a year, it is worrying that nearly one in 10 are not meeting the submission deadlines even though HMRC waived fines this year and gave customers more time.

“People should endeavour to submit on time as calculating your tax liabilities gives you the time to budget and manage your cashflow for the year ahead. Filing early also means receiving any tax refunds faster, and avoiding mistakes brought on by a last-minute scramble."

Children have individual tax allowances just like adults, with the personal allowance for the 2021/22 tax year set at £12,750 before they pay tax. For those who receive income on savings, the allowance rises to £18,750 as they are entitled to another £6,000 in tax-free interest.

Children are not allowed to work full-time except in certain occupations until the age of 16 and can only work part-time from 13 or over. Children working television, theatre or modelling need to have performance licences from local authorities in order to work.