Late filing penalties

⚠ The penalties stack. Each one is added to the ones before it rather than replacing them, so a return a year late carries the initial charge, the daily charges and both percentage charges together.

Late filing, in four stages

An immediate fixed penalty the day after the deadline, whether or not any tax is owed. Daily penalties from three months, capped at ninety days' worth — so they stop before the six-month mark rather than running on. Then a percentage of the tax due at six months and again at twelve, each with a minimum that bites when the tax is small.

That minimum is why a nil return filed a year late still costs £1,600. The penalty for filing late is not proportional to the tax, and for someone who owed nothing it is the whole of the charge.

Late payment is separate

Filing and paying are two obligations with two sets of penalties. Paying late attracts its own percentage charges at thirty days, six months and twelve months — so filing on time and paying late still costs, and a lot of people assume the return is the only deadline that matters.

Interest is on the tax, and not compounded

It runs daily from the day after the payment deadline, on the tax rather than on the penalties. ⚠ The rate moves with the Bank of England base rate rather than with the tax year — it has changed five times in two years — so the date it applies from is shown above. If that date looks old, check it.

Reasonable excuse

Penalties can be appealed if you have a reasonable excuse, and HMRC's own list is wider than most people assume: a serious illness, a bereavement, a service failure at HMRC's end, a fire or a flood. Not having the money is explicitly not one, but not being able to get the money is sometimes accepted.

What this does not cover

Partnership returns, where every partner is charged separately for one late return. Failure to notify penalties, which apply when you should have registered and did not, and are worked out on the tax rather than on a scale. Deliberate or concealed behaviour, which carries far higher penalties. Time to Pay arrangements, which can stop late payment penalties accruing if agreed in time. And the new points-based system, which applies to VAT rather than to Self Assessment.

Where these figures come from

Every figure above is read from a dated rate file rather than written into the page, and each one is checked against the gov.uk page it came from. How these numbers are kept right sets out the whole process.

Payments on account