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Self-Assessment Tax Return penalties

What happens if I miss a Self-Assessment tax return deadline?

Filing a late tax return is a bad move, and it’s all too common. You’ve got until the 31st of January to file your tax return online, then until the 31st of July to make your payment on account, and you can expect HMRC to chase you if you miss either deadline. The penalties for failing to file your return or pay the tax you owe can be severe and painful, so it’s essential that you keep up.

Missing a filing deadline by just one day means you're already facing an automatic fine of £100.

After that, things just keep getting worse. Depending on which deadline you've missed, you could be looking at daily penalties or fines based on a percentage of the tax you owe. Worse still is the possibility that HMRC decides you're trying to cheat your way out of paying up. Getting caught in the sights of an HMRC investigation isn’t fun, and can lead to some serious consequences.

Tax penalitiesPenalties for filing a late tax return

The penalties for filing your Self Assessment tax return start at £100 for missing the deadline by a single day. You can also find yourself coughing up interest on both the unpaid tax and any financial penalties you haven’t paid yet. The list of acceptable excuses for failing to file your return or pay up what you owe on time is very short. Simply ‘not having time’, or the deadline ‘slipping your mind’ won’t be enough. If you do have a valid reason for filing a late tax return, it’s critical that you let HMRC know as quickly as possible. The faster you act, and the more you demonstrate that you’re doing your best to fix the problem, the better.

Here are the main deadlines and penalties you need to know about:

Late Filing	Late Payment	Penalty
Miss filing deadline of 31 Jan		Automatic £100
	30 days late	5% of tax due
3 months late		Daily penalty £10 per day for up to 90 days (max £900)
6 months late		5% of tax due or £300, if greater
	6 months late	5% of tax outstanding at that date
12 months late		5% or £300 if greater, unless the tax payer is held to be deliberately withholding information that would enable HMRC to assess the tax due.
	12 months late	Based on behaviour: deliberate and concealed withholding: 100% of tax due, or £300 if greater. deliberate but not concealed: 70% of tax due, or £300 if greater. Reductions apply for prompted and unprompted disclosures and telling, giving and helping.

Example of late payment fines:

Bill forgets to file a Self Assessment tax return for the last tax year because he’s been away travelling. Some time after he gets home, he realises the mistake he’s made and immediately sets about fixing it. However, by now, Bill’s tax return is a full 12 months late. The overall tax Bill owes for the tax year is £10,000.

Here’s how Bill’s penalties look:

Trigger date	Penalty
Missed filing deadline: Jan 31st	Automatic £100
Unfiled after 3 months: 30th April	£10 per day(for total of £900)
Unfiled after 6 months: 31st July	£300
Unfiled after 12 months: 31st Jan	£300

In total, the penalties for Bill’s late tax return come to a whopping £1,600. After that, things get worse. Not only has Bill missed the Self Assessment filing deadline, but he’s also failed to pay the £10,000 in tax he owes. The penalties for that look like this:

Trigger date	Penalty
Unpaid by midnight 2nd March	£500 (5%)
Unpaid by midnight 1st August	£500 (5%)
Unpaid by midnight 1st Feb	£500 (5%)

That’s another £1,500 on top of what he already owes. When you add all these penalties together, Bill ends up with a total bill for the year of £13,100, including the £10,000 he owes in tax. If Bill also has payments on account due for the upcoming tax year, that could increase the late payment penalties even more!

Changes to self assessment finesWhat happens if I make a mistake in my Self Assessment tax return?

Back in September 2017, the rules for working out penalties changed, meaning a mistake in your tax return could land you with a penalty of up to 100% of what you owe.

Obviously, the taxman understands that there’s a difference between an honest mistake and an attempt to cheat on your tax. It’s still very much up to you to prove that you’re trying to play fair, though. Sloppy bookkeeping is bad enough, and can land you with a penalty of 30% of what you owe. If the taxman thinks you're deliberately underestimating the tax you’re supposed to pay, though, you could be hit with a penalty of as much as 70% of what you owe. If you actively try to hide the fact that you’re cheating, that can go up to a full 100%.

Making mistakesWhat happens if I've given the wrong information in my Self-Assessment tax return?

Honest mistakes do happen, and it’s sometimes possible to fix the problem before you get hit with a penalty. You can change your Self Assessment tax return for up to 12 months after the filing deadline. If you file your returns online, all you need to do is log in and correct the information. Paper returns are a little more complicated since you’ll have to download another copy of the form and send in the corrected pages.

However you amend your Self Assessment tax return, it’s important to do it quickly. The taxman can and will start dishing out penalties if he thinks you’re:

Deliberately understated how much tax you owe.
Deliberately claimed too much for expenses or tax relief.
Been careless or dishonest with your bookkeeping.

If your mistake was honest, you told HMRC about it yourself and you’ve taken quick steps to fix it, there’s a good chance you won’t be hit with a penalty. If you are, then there may still be ways to limit the damage

Genuine mistakesHow can I lower the penalty for making a genuine mistake?

The first thing to do is make sure you cooperate with any HMRC investigation you’re facing. That won’t get you entirely off the hook on its own, but it’ll make the whole experience a lot less painful. Letting HMRC know about an honest mistake can actually lower the penalty by 30%, for example, as can giving them good access to your business records. Actively helping them to track down the problem can cut the penalty down by 40%.

Remember, the longer you take to own up and fix the mistakes in your Self Assessment tax return, the more problems you’re going to have. If you still haven’t got everything straightened out after 3 years, whatever penalties you're facing could ramp up by at least another 10%. Even if you've been cooperating enough to get your penalty cancelled, that 10% will still apply. If HMRC found the mistake without you telling them about it, your minimum penalty after 3 years is 25%.

While openly letting HMRC know about your Self Assessment mistakes is essential, you can’t expect that to cancel any penalties you’ve already been lumped with. That's why talking to RIFT is your best bet if you've spotted a problem with your Self Assessment tax return. We're on great terms with HMRC, and have a strong record of protecting our customers when they've made honest mistakes. Better yet, using the RIFT Tax Return service means you'll never get lumped with a penalty in the first place. We've got the expertise to keep your returns error-free and filed on time.

What is a reasonable excuse?Are there any valid reasons for giving late or incorrect information?

It’s important to be realistic about this. HMRC doesn’t cancel penalties for filing incorrect tax information lightly. That said, here are a few ‘reasonable excuses’ that they sometimes accept:

HMRC gave you the wrong advice or never let you know you had to file.
You were hit by a serious illness or other difficult personal circumstances.
You made an honest attempt to file or pay online, but without your knowledge a technical error messed it up.
Bank errors or postal delays.

Obviously, you have to be honest about this. Piling up more false information on top of an incorrect tax return will only dig you deeper into the hole you’re already in. That said, the taxman has no interest in punishing people for things that genuinely weren't their fault. If you've taken all reasonable care over your payments and paperwork, you shouldn't come off too badly.

Mistakes happenWhat if HMRC has made a mistake?

Mistakes at HMRC’s end do happen as well, of course. A surprise demand from HMRC for a tax return or payment could mean they’ve simply got their wires crossed – but it could also mean you’ve been the victim of identity theft. Either way, you need to get the situation clarified and cleared up straight away. Sticking your head in the sand and hoping the problem goes away won’t work, and the trouble will only get worse if you ignore it.

FinesHow many people get a Self-Assessment fine?

Around 600,000 people missed the tax return deadline in January 2023, receiving an automatic fine of £100. The taxman’s serious about Self Assessment paperwork, so if the deadline for filing your return and paying the tax you owe is already gone, then your penalties are already stacking up.

Take a look at our online tax return calculator for a free quote for our Tax Return service, or get in touch by phone or email for more information. If you're already facing a penalty, definitely get in contact as soon as possible. You'll be surprised how much we can do to help.

AppealingHow to appeal a penalty

If you've received a penalty that you didn’t deserve, you need to make an appeal within 30 days of the date HMRC sent you the penalty notice. As we’ve already mentioned, you’ll need to have a reasonable excuse for late filing.

There are 2 kinds of appeal you can make:

Use the online service to appeal a £100 late filing penalty for tax returns.
Print the postal form SA370 and return it to appeal against a penalty for:
- sending tax returns late for earlier years
- paying your tax late.

Visit the HMRC website for more information.

HelpCan I get help?

Absolutely! At RIFT Tax Refunds, we've been helping people with their tax worries since 1999.

Whether you think you might be owed a tax rebate or have questions about your tax codes we can help. If you can't understand why the taxman's chasing you, we'll solve the mystery.

If you've already got a penalty, we might be able to get it reduced or dropped entirely. If you're having trouble getting your paperwork done right and filed on time, we're here to help.

Tax is often a painful subject, so let the RIFT tax return service help take the sting out of it.

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Self-Assessment Tax Return penalties​