Number of late tax return penalties falls by 40%
21 Feb 2012
The number of penalties issued for late tax returns has fallen by around 40%, HM Revenue & Customs (HMRC) has revealed.
The tax authority is issuing some 850,000 late filing penalties over the next two weeks – 550,000 fewer than last year.
Individuals who missed the deadline are being issued with an initial £100 fixed penalty, which applies even if there is no tax to pay, or if the tax due is paid on time.
However, individuals have until 31 March to appeal against the automatic fine if they believe they have a 'reasonable excuse' for missing the deadline.
Experts say the fall in the volume of fixed penalty notices is likely to be a result of HMRC's tough new penalty regime, which recently came into force.
Under the new regime, tax returns which are still not filed after three months will be subject to daily penalties, and additional penalties will apply to returns which remain unfiled after six and 12 months, adding up to a potential penalty of £1,600 or more.
Commenting, HMRC's Stephen Banyard said: 'We want the returns, not the penalties. So anyone who still hasn’t sent theirs should do so as soon as possible.
'People who receive a penalty notice should act now to avoid further penalties. They should send in their return, appeal if they think they have a reasonable excuse, or contact us if they think they shouldn't have been in Self Assessment.'
The official online filing deadline of 31 January was effectively extended this year, when HMRC announced that no penalties would be issued for online returns received by midnight on 2 February, following concerns over the likely impact of strike action by Revenue staff, which coincided with the deadline.