What penalties can I expect for a late tax return?

If you file after the deadline of 31st January you will be issued with an automatic late filing penalty of £100, irrespective of your tax liability or what tax you had outstanding at the time of filing your self-assessment tax return. 

However, HMRC has announced that no penalties will be issued if you file your tax return online by 28th February 2022, to help ease pressures on those affected by coronavirus.

If you will file your return within the next three months of the deadline, you will avoid the next wave of late filing penalties which are £10 per day - for up to 90 days. Further penalties are applied when the return reaches over six and 12 months overdue of the higher of £300 or 5% of the tax outstanding. Each of these penalties are all in addition to one another; not in place of.

If you have any tax outstanding, interest will begin accruing immediately, and a 5% late payment penalty is also charged on any unpaid tax that is still outstanding on 3rd March. But this year, because of the impact of the COVID-19 pandemic, HMRC is giving taxpayers more time to pay or set up a payment plan.

You will not be charged the 5% late payment penalty if you pay your tax or set up a payment plan by 1st April 2022.

If you’re struggling to keep on top of your tax affairs, please contact us and we would be happy to take care of them on your behalf - leaving you to concentrate on running your business. 

Date published 26 Jan 2016 | Last updated 13 Jan 2022

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.