Lower earners are the most likely group to miss the self-assessment deadline, new data shows.
A new set of figures from HM Revenue and Customs reveals a clear and troubling pattern in who is falling behind on the UK self-assessment tax deadline — and lower-earning self-employed workers are overwhelmingly bearing the brunt of it.
Data obtained by retirement savings provider PensionBee through a freedom of information request shows that in 2023-24, approximately 180,000 self-employed filers submitted their tax returns after the January 31 deadline. The figures lay bare a stark divide that runs along income lines, raising serious questions about how well the current tax system serves those at the lower end of the earnings scale.
Who is missing the deadline
The breakdown across the four main taxpayer groups tells a consistent story of late filing in 2023-24:
- Below basic rate taxpayers had the highest rate of late filing, with approximately 5.9% missing the deadline.
- Basic rate taxpayers followed at 3.1%.
- Higher rate taxpayers came in at 2.7%.
- Additional rate taxpayers had the lowest rate of late filing, at 2.6%.
Taken together, the figures show that around 94% of all late self-assessment filers in 2023-24 were either below basic or basic rate taxpayers. For the roughly 180,000 workers who missed the cutoff, the financial consequences can be immediate.
The cost of missing the deadline
Anyone who files their self-assessment return after January 31 faces an initial £100 penalty, regardless of how much tax they owe or whether the delay was brief. From there, further charges can accumulate the longer a return remains outstanding, and the total cost can climb considerably. HMRC does have the authority to waive penalties if a late filer can demonstrate a reasonable excuse, but navigating that process requires an awareness of the rules that not everyone has.
Why lower earners are falling behind
PensionBee’s analysis points to a combination of factors that make lower-earning self-employed workers particularly vulnerable to missing financial deadlines. The data suggests a potential knowledge gap among this group, alongside broader structural challenges that the current system may not be adequately designed to address.
One of the most significant barriers identified is access — or the lack of it. Higher earners are far more likely to work with an accountant or financial adviser who can manage their filing obligations for them. For those at the lower end of the income scale, that kind of professional support is often out of reach, leaving them to navigate the self-assessment process entirely on their own.
Income volatility adds another significant layer of difficulty. For many in the so-called invisible workforce — self-employed workers whose earnings shift unpredictably from month to month — keeping pace with fixed administrative deadlines can feel secondary to the more immediate pressure of simply making ends meet. Tax filing, for these workers, can easily slip through the cracks during a particularly difficult financial stretch.
PensionBee‘s broader research also points to a related concern — many lower-earning self-employed workers are entirely unaware that pension contributions made through personal schemes can qualify for tax relief, a benefit that could meaningfully improve their long-term financial position if more people knew to take advantage of it.
What HMRC says
HMRC pointed to its ongoing efforts to support self-assessment customers, noting that it runs a national awareness campaign each year in the lead-up to the filing deadline. The agency also highlighted the guidance available on its website and the additional help provided by its advisers for those who need it.
The effort appears to be making some meaningful difference. For the 2024-25 tax year, HMRC reported that 11.5 million customers filed their return on time — a figure that underlines how many people are successfully meeting their obligations each year, even as the persistent gap between lower and higher earners continues to be a pressing concern for policymakers and financial advocates alike.
Source: PA Media