HMRC Summary of Main Penalties

  Individuals

 

Self-Assessment

Length of delay Penalty you will have to pay
1 day late A penalty of £100. This applies even if you have no tax to pay or have paid the tax you owe.
3 months late £10 for each following day - up to a 90 day maximum of £900. This is as well as the fixed penalty above.
6 months late £300 or 5% of the tax due, whichever is the higher. This is as well as the penalties above.
12 months late £300 or 5% of the tax due, whichever is the higher.
In serious cases you may be asked to pay up to 100% of the tax due instead.
These are as well as the penalties above.

 

Businesses

PAYE Annual Returns

forms P35 and P14 must reach HMRC is 19 May  £100 per 50 employees for each month or part month you delay filing your return
form P11D(b), it must reach HMRC by the filing date of 6 July  £100 per 50 employees for each month or part month you delay filing your return

 

Penalty charges for late monthly and quarterly PAYE / NI and  student loans payments

No. of defaults in a tax year

Penalty percentage

Amount to which penalty percentages apply

1-3

1%

Total amount that is late in the tax year (ignoring the first late payment in that tax year)

4-6

2%

7-9

3%

10 or more

4%

 

VAT

Turnover less than £150,000

Defaults

Surcharge to pay (calculated as a percentage of your unpaid VAT)

Surcharge period

First default

No surcharge. Help letter issued.

None, but if you miss another VAT deadline within 12 months of the issue of a help letter you will formally enter the surcharge system.
Second default

No surcharge. Surcharge Liability Notice issued.

12 months
Third default in a surcharge period

2% (unless it is less than £400, in which case you won't be charged a surcharge at this rate)

12 months from the date of the most recent default
Fourth default in a surcharge period

5% (unless it is less than £400, in which case you won't be charged a surcharge at this rate)

12 months from the date of the most recent default
Fifth default in a surcharge period

10%

12 months from the date of the most recent default
Sixth and subsequent defaults in a surcharge period

15%

12 months from the date of the most recent default

  

Turnover more than £150,000

Defaults

Surcharge to pay (calculated as a percentage of your unpaid VAT)

Surcharge period

First default

No surcharge. Surcharge Liability Notice issued.

12 months
Second default in a surcharge period

2% (unless it is less than £400, in which case you won't be charged a surcharge at this rate)

12 months from the date of the most recent default
Third default in a surcharge period

5% (unless it is less than £400, in which case you won't be charged a surcharge at this rate)

12 months from the date of the most recent default
Fourth default in a surcharge period

10%

12 months from the date of the most recent default
Fifth and subsequent defaults in a surcharge period

15%

12 months from the date of the most recent default

  

Penalties for inaccurate returns

Reason for the error Disclosure of the error to HMRC Minimum penalty (as a percentage of the tax) Maximum penalty (as a percentage of the tax)
  NB A disclosure is unprompted if at the time you tell HMRC about it you have no reason to believe HMRC have discovered it, or are about to discover it.    
Careless Unprompted 0% 30%
(you fail to take reasonable care) Prompted 15% 30%
Deliberate Unprompted 20% 70%
(you knowingly send HMRC an incorrect document) Prompted 35% 70%
Deliberate and concealed Unprompted 30% 100%
(you knowingly send HMRC an incorrect document and try to conceal the inaccuracy) Prompted 50% 100%

 

 Limited Companies

Penalties for not filing your Company Tax Return on time

Months after deadline

Cumulative Penalty

1

£100

+3

£100

+6

£500

+3

£500

 

Penalties for not telling HMRC your company is liable for Corporation Tax

Type of failure Maximum penalty payable
Non-deliberate 30% of the potential lost revenue
Deliberate but not concealed 70% of the potential lost revenue
Deliberate and concealed 100% of the potential lost revenue

  

Companies House fines

Length of delay (measured from Penalty : Penalty :
the date the accounts are due) Private company Public company
Not more than 1 month

£150

£750

More than 1 month but not more than 3 months

£375

£1,500

More than 3 months but not more than 6 months

£750

£3,000

More than 6 months

£1,500

£7,500