The deadline for self assessment tax returns should be changed to make it easier for businesses to get them in on time, a lobby has argued.

The Federation of Small Businesses (FSB) is urging the Inland Revenue (IR) to adopt a system that spreads the flow of tax returns throughout the year, instead of opting for today's January 31st deadline.

Late payers will face automatic fines of £100, with the Inland having the power to add an extra £60 per day until payment is received.

The FSB also argues that, at least, the deadline should be put back later in the year to allow businesses to manage their finances easier after the Christmas period.

Simon Sweetman of the FSB’s taxation unit, said: “Human nature being what it is, more and more people are leaving filling in their tax return until the last two weeks before the deadline.

“The problem gets worse every year and the system is then clogged for months to come. It makes sense to me to allow different types of taxpayers to file their returns at different times of the year.”

The lobby believes that one option would be for the self-employed to be allowed to file their tax returns within a year of their accounting data.

However Francis Taylor, spokesperson for the Inland Revenue, said: “It is easy to make these type of comments but it is a requirement of law to meet the deadline and any changes would just make the issue more confusing for people.

“Whatever date the deadline was, somebody would complain.”

Other changes proposed by the FSB include:

  • A facility to pay income tax direct in monthly installments
  • A facility to pay over the internet using a credit card
  • The provision of a single point of contact in a local post office, rather than call centres