Self Assessment Late Filing Penalties

Taxpayers should be aware that there are new penalty rules where income tax self assessment (SA) returns are filed late.

Also from this year, the ‘capping’ rule which reduced the tax return late filing penalty from £100 to nil if all the tax had been paid by 31 January has gone. If you miss the SA filing deadline this year you will be immediately liable for a £100 late filing penalty. The penalty will apply even if there is no liability or if any tax due is paid in full by 31 January 2012.
The new penalties will apply to all SA tax returns from 2010/11 onwards. The fixed £100 penalty for failing to file a tax return on or before the filing date will therefore apply to:

  • Paper returns received on or after 1 November
  • Online returns received on or after 1 February 2012.Daily penalties of £10 per day will also take effect if the tax return is still outstanding three months after the original due filing date.

    There is no change to the rule that penalties will not be due where there is a reasonable   excuse for filing late.

If the return is still outstanding after 6 months, a tax geared penalty of the greater of £300 or 5% of the liability which would have been shown on the return is chargeable.

A further penalty of the same amount is also due if the return is still outstanding 1 year after the original due date.

The above article is for guidance only and is not intended to be a comprehensive statement of the relevant facts and law. Readers are advised to seek professional advice before acting on any of the information presented in this article.

And you can always ask John Nixon for more advice!

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