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Self-assessment tax return

Late tax returns and penalties for mistakes

By Ian Robinson

Article 9 of 10

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Late tax returns and penalties for mistakes

In this expert guide, find out what happens if you file your tax return late, plus information on the penalties and fines for filing an incorrect tax return.

Hefty fines can quickly stack up if you miss the tax return deadline. This guide explains what penalties HMRC levies, what happens if you ignore the deadlines, and how you can challenge a penalty. 

And you can avoid a fine by getting a head start on your 2016-17 tax return with the Which? tax calculator. Tot up your tax bill, get tips on where to save and submit your return direct to HMRC with Which?. 

Late tax return penalties

If you miss the final deadline to file your 2016-17 return HMRC will charge you £100. The following fines are levied for subsequent missed deadlines: 

  • Three months late - A fine of £10 for each following day up to a 90 day maximum of £900. This is in addition to the fixed penalty above, so the overall fine could be £1,000.
  • Six months late - A fine of either £300 or 5% of the tax due, whichever is the higher, will apply on top of the penalties above.
  • 12 months late - Another £300 fine or 5% of the tax due, whichever is the higher, will be added to your bill on top of the penalties above. In serious cases you may be asked to pay up to 100% of the tax due instead, as  well as any tax you owe, doubling your payment.

Use the Which? online tax calculator : our easy-to-use and jargon-free tax calculator offers personalised tax tips, and you can submit the form directly to HMRC.

Late tax payment penalties

The deadline for paying tax for the 2016-17 tax year is 31 January 2018. If you miss this deadline you’ll be charged interest from the date the payment was due. The interest rate varies – you can check the current rate payable on HMRC's website.

If any of the tax bill remains unpaid by 28 February 2018, you'll be charged a 5% surcharge. An additional 5% is imposed on any of the tax bill which is unpaid by 31 July 2018.

Find out more: Reasonable excuses for filing a tax return late - when you should appeal against a fine 

Incorrect tax return penalties

There is a system of penalties for mistakes on your tax return, depending on whether HMRC thinks you have been careless or have tried to mislead them. 

Penalties are based on the amount of tax you owe, and are payable in addition to the tax owed.

  • If you have taken reasonable care to fill in your return correctly, you’ll have no penalty to pay.
  • If you have been careless, the penalty will be between 0% and 30% of the extra tax owing.
  • If you have deliberately underestimated your tax, the penalty is between 20% and 70%.
  • If you have deliberately underestimated your tax and attempted to conceal the fact, the penalty will be between 30% and 100%.

Find out more: Tax appeals, disputes and complaints how to appeal if you think you’re being overcharged

Get help with filling in your tax return

To help taxpayers complete a return correctly, HMRC produces a 28-page guide, How to fill in your Tax Return (SA150). There is also an online demonstration of the self-assessment process on the HMRC website.

Taxpayers can get help from HMRC in writing, by telephone and face-to-face at HMRC offices:

  • The Self-Assessment Helpline (0845 900 0444) can offer general tax advice, and help with filling in your tax return. The service is open seven days a week, from 8am to 8pm.
  • For technical difficulties filling in your return online, contact the Online Services Helpdesk (0845 605 5999) for help. The service is open Monday to Saturday from 8am to 8pm.
  • If you are struggling to pay your tax on time, you can contact HMRC’s Payment Helpline on 0845 366 1204 for advice.

Find out more: If you need more help with tax, or any other aspect of your finances, sign up to a £1 trial with Which? and you can speak to a member of our Money Helpline team to get individual guidance.

  • Last updated: April 2017
  • Updated by: Gareth Shaw

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