A penalty is a cowardly way to score. - Pele.
Just a reminder for all you self-assessed taxpayers: The new penalty regime (detailed in FA 2009) is applicable for the tax year 2010/11 onwards. The tax year 2010/11 ended on 5 April 2011 and you now have until 31 January 2012 to file your 2010/11 Return. Be warned: if you miss the deadline the following (new) penalties will apply:
· £100 for missing the deadline;
· £10 a day for every day missed in the next 3 months;
· If you've still not filed within 6 months of the deadline, an additional penalty is applied of the higher of £300 or 5% of the tax;
· If your return is still outstanding 12 months after the deadline, an additional penalty is applied of the higher of £300 or 5% of the tax. In serious cases, you may receive a penalty of 100% of the tax.
As you can see, and as we blogged last week, HMRC have taken the gloves off. Gone is the old £100 fixed penalty for late filing. Under the new system you could in theory incur penalties of £1,300 if you have not filed within 6 months of the deadline. It is also worth bearing in mind that these penalties are only for late filing. Separate penalties apply if there are errors in your return and interest and surcharges apply if you are late in paying your tax.
The new penalty regime and indeed the broader changes at HMRC are all part of a long term strategy to boost the tax take and close the tax gap so you can expect closer scrutiny from HMRC in the future.
Here at taxback.com we offer a fully compliant easy to use tax return service. Register for a call back now and take the hassle out of your annual filing.