Stiffer penalties for missed tax returns
Self-assessment taxpayers filing their returns late face penalties of hundreds of pounds after HM Revenue and Customs (HMRC) amended its penalty system.
The 100 late payment charge is being replaced by one that rises at a rate of 10 a day, while fines will no longer be cancelled if the taxpayer owes HMRC no money or has paid their tax. The initial 100 fine will still be levied and delays will be charged up to a maximum of 900 for the three months following the deadline. Delays of between three and six months will trigger a fine of the higher of 300 or 5 per cent of the tax due. Taxpayers not filing their return for 12 months face fines of at least 1,600. The changes, which come into force for 2010-11 tax year returns, are aimed at encouraging people to submit returns as soon as possible even if they miss the deadline.