HMRC has just launched a stricter penalty system for people who still have not submitted their Self-Assessment tax return and the cost is climbing every single day.
If you are not sure what this means or whether it affects you, do not panic. We have broken it down in the simplest way so that you can take the right action and avoid unnecessary fines.
What is HMRC and Why Are They Fining People?
HMRC stands for HM Revenue and Customs. It is the UK government’s tax department. They collect things like income tax, national insurance, VAT, and deal with benefits and pensions.
If you are self-employed, have side income, or meet certain criteria, HMRC asks you to submit a Self-Assessment tax return each year. This is your way of telling them how much you earned and whether you owe any tax.
If you miss the deadline and do not file your return on time, HMRC issues penalties to encourage people to stay on top of their taxes.
What’s Changed?
Until recently, if you missed the Self-Assessment deadline, you would be fined a flat £100. That fine still applies. But now, HMRC is adding a new penalty – a £10 fine for every day your return is late.
This daily fine lasts for up to 90 days. That means you could end up owing £900 on top of the original £100, and that is before any other penalties or interest.
Full Breakdown of Penalties
If you ignore your return, here’s what you could face:
- Miss the deadline: £100 fine straight away
- After 3 months: £10 per day for up to 90 days (£900 total)
- After 6 months: 5 percent of the tax you owe or £300 – whichever is greater
- After 12 months: Another 5 percent or £300
🔺 On top of this, HMRC charges interest on unpaid tax at 8.5 percent – which is higher than most credit cards.
What If You Cannot Pay?
There are two main support options:
1. Reasonable excuse – You may be able to appeal if you had a serious issue such as illness, bereavement, or technical problems with the HMRC portal.
2. Time to Pay arrangement – You can set up a payment plan through HMRC’s website and spread the cost in instalments.
Should I File Even If I Don’t Owe Anything?
Yes – this is a common mistake. Even if you do not owe tax, if HMRC is expecting a return from you and you do not file it, you will still be fined.
Don’t Let It Pile Up
Ignoring it will not make it go away. The longer you delay, the more expensive and stressful it becomes.
Tackling it now gives you peace of mind and saves money in the long run.
Need Help with Your Self-Assessment?
We help hundreds of people each year submit their returns and avoid unnecessary fines. Whether it is a quick question or full support with your tax return, we are here to make it easier.
📞 Click here to get in touch with Nordens today
