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Understanding HMRC Policies

Monday 5th August 2024


Self-Assessment Deadlines and Penalties


Missed Submission Deadlines:

  • 1 Day Late: £100 Penalty

  • 3 Months Late: £10 Daily penalties, up to a maximum of £900

  • 6 Months Late: Additional £300 or 5% of the tax due, whichever is greater.

  • 12 Months Late: Further £300 or 5% of the tax due, whichever is greater.


Missed Payment Deadlines:

  • 30 Days Late: 5% of the tax unpaid at that date.

  • 6 Months Late: An additional 5% of the tax unpaid at that date.

  • 12 Months Late: Another 5% of the tax unpaid at that date.


PAYE and National Insurance Late Payment Penalties


First Late Payment:

No penalty for the first late payment in a tax year, unless the payment is more than six months late. 


Subsequent Late Payments: 

  • 1-3 Late Payments: 1% of the amount that is late.

  • 4-6 Late Payments: 2% of the amount that is late.

  • 7-9 Late Payments: 3% off the amount that is late.

  • 10 or more Late Payments: 4% of the amount that is late.


Additional Penalties:

  • Payments more than 6 months late: An additional 5% of the unpaid amount. 

  • Payments more than 12 months late: Another 5% of the unpaid amount.



VAT Missed Payment Penalties


If you miss a VAT payment deadline, you enter a 12-month surcharge period. If you default again during this period, you may be liable to a surcharge on the VAT due. 


  • First Default: No surcharge, but you receive a surcharge liability notice. 

  • Second Default (within 12 months): 2% of the VAT due.

  • Third Default (within 12 months): 5% of the VAT due. 

  • Fourth Default (within 12 months): 10% of the VAT due. 

  • Fifth Default (within 12 months): 15% of the VAT due. 


Penalties for Late Filing:

  • Late Filing Penalty: A fixed £200 penalty applies if you reach the penalty points threshold and then miss another deadline. 

  • Interest: HMRC charges interest on late payments from the date the payment was due until it is received. 



Corporation Tax Penalties


Late Filing Penalties:

  • First Time Late: If you file your corporation tax return late, you'll face an initial penalty of £100.

  • Repeated Late Filing: If you file late three times in a row, the penalty increases to £500 for each late filing. 


Further Delays:

  • 3 Months Late: If your return is more than three months late, you will face an additional penalty of £100. 

  • 6 Months Late: If your return is more than six months late, HMRC will estimate your corporation tax bill and add a penalty of 10% to the unpaid tax. 

  • 12 Months Late: If your return is more than twelve months late, a further 10% penalty is added to the unpaid tax.  


Late Payment Penalties:

  • Interest on Late Payments: Interest is charged on unpaid corporation tax from the day after the tax is due until it is paid. 


Late Payment Penalty:

  • After 6 Months: A penalty of 5% of the unpaid tax is charged. 

  • After 12 Months: An additional 5% penalty of the unpaid tax is charged. 

  • Continued Delay: Further penalties may be applied if the tax remains unpaid after 18 and 24 months.    

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