HM Revenue and Customs has warned taxpayers that late filing of tax returns will result in significantly increased penalties from April 2011.  The rationale being that the current £100 penalty is "not enough of a deterrent"

The hike comes of course at a time of substantial belt-tightening within the public finances, and it is difficult to avoid the conclusion that the two are related. Tax payers will not be be comforted by this further margin-for-error squeeze

The new Late Filing penalties are:

  • £100 for 1 day late, even if there is no tax to pay OR if all taxed owed has been paid
  • 3 months late will incur a daily penalty of £10 per day - maximum £900
  • 6 months late will incur further penalties, the greater of 5% of tax due or £300
  • 12 months late will incur even more penalties, the greatest of 5% of the tax due or £300.  In more serious cases, or taxpayers who are repeatedly late, there could be penalties up to 100% of the tax due

... and for Late Payment:

  • 30 days late will incur an initial penalty of 5% of the unpaid tax
  • 6 months late will result in a further 5% of the tax still unpaid
  • 12 months late will involve in another 5% of the tax remaining unpaid

As before the Revenue will also charge interest on any tax liability not paid and on the penalties levied

 

Blair Cadell  are experienced solicitors, Edinburgh estate agents, elderly care solicitors -  if you are looking for friendly and reliable service at a reasonable cost give us a call.