Self-Assessment Penalties

Tax technician Tyler Hursey explains more about when your Tax Return needs to be filed.
 
If you are required to submit a 2016/17 tax return this will need to be submitted to HM Revenue and Customs by 31 January 2018 if done electronically. (If submitting your tax return by paper, this should have been done by 31 October 2017.) You will see below that it is within your interest to comply with HMRC.
 
Late Filing Penalties:
If you fail to file your Tax Return before 31 January 2018 you will be charged an automatic late filing penalty of £100. If HMRC still haven’t received your return after 3 months, then daily penalties will be charged at £10 per day for a maximum of 90 days.
 
As you can see these penalties can build up quickly, and if the charges are still outstanding 6 months after the deadline (31 July 2018) an additional penalty of 5% of the liability or £300 (if greater) will be charged. This is then charged again if the return is greater than 12 months late.
 
Late Payment Penalties:
 
Late payment penalties will be charged when the payment of tax due is not made by the due date of 31 January. I have set the penalties out below that will be charged:
 
> 30 days late                                           5%
> 5 months after first penalty charge          Additional 5%
> 11 months after first penalty charged     Additional 5%
 
In addition to this HMRC will charge interest on any tax paid late. 
 
Penalties for Incorrect Returns:
 
In addition to filing your Tax Return on time, it is just as important to make sure that it is correct. HMRC will have 1 year from the date of submission to enquire into your Tax Return. Penalties charged will be a % of the understated tax, and the penalty will depend on the seriousness of the offence as shown below:
 
                                   Careless       Deliberate but not concealed         Deliberate and concealed
Maximum Penalty             30%          70%                                          100%
Minimum if unprompted    0%            20%                                          30%
Minimum if prompted       15%           35%                                          50%
 
Across Scrutton Bland’s Colchester and Ipswich offices we deal with over 2,000 Tax Returns each year.  If you would like any help in completing and submitting your Tax Return, please get in touch with your usual Scrutton Bland contact or give us a call on 01206 838400.