Record £860m in tax penalties issued last year

Last year HMRC imposed a record number of penalties on individuals for late tax payments and filing. £860m was taken in by HMRC in 2018/19, which is a massive 24% increase from 2017/18. The huge increase in penalties is thought to be the result of people struggling to meet the payments deadline. With the deadline for your tax return just around the corner (midnight January 31^st), don’t be caught out this year.

The penalties

Unsurprisingly, as time goes on, fines for late tax payments and filing begin to accumulate. If your tax liability for the year is overdue by 30 days, you will be met with a penalty of 5% of the underpaid amount.

A further 5% will then be added on to this, if it remains unpaid at 6 months, and then 12 months after the deadline. For late filing, taxpayers will face an initial £100 fine.

If your tax return still hasn’t been filed after 3 months, a hefty £10 per day penalty will then be imposed up to £900. Then at the 6 month mark, a further £300 penalty is applied. The penalty can accumulate up to £1,300. On top of these penalties, if HMRC believes that the delay in filing is deliberate, the taxpayer may have to pay double the amount that was initially due.

How can we help?

Penalties can easily be avoided with forward planning. Our Year End Tax Guide is an easy and quick way to understand your options. If you're still scratching your head, get in touch today, to see how our tax experts can help with your tax returns, including filing on your behalf.