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HMRC issues 850,000 late filing penalties

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HMRC will issue 850,000 penalty notices during the next fortnight for late filing of tax returns. A record 90.4% of taxpayers filed on time this year.

‘Anyone who still hasn’t sent their return to HMRC should do so now or risk further penalties. For example, anyone whose return is more than three months late will be charged an additional £10 penalty for each day it remains outstanding, up to a maximum of 90 days,’ HMRC said.

‘Although the deadline for receiving online returns was 31 January, this year HMRC is not issuing penalties to people who sent their 2010/11 return online on 1 or 2 February, following strike action at HMRC’s call centres on 31 January.’

People who receive the £100 penalty may appeal in writing by 31 March. Guidance on what is a reasonable excuse for late filing is set out on the HMRC website. The CIOT’s Low Incomes Tax Reform Group has also published detailed guidance.


Robin Williamson, LITRG Technical Director, said: ‘The basic test is that you behaved as any reasonably responsible person would have done in the circumstances. If you have done so, do not be discouraged from lodging a reasonable excuse appeal against any late filing penalty you receive. HMRC say they wish to be more flexible in how they interpret reasonable excuse, and to treat people with sensitivity and even-handedness. Even if HMRC turn down your appeal at the first hurdle, remember that the ultimate decision lies not with them but with the Tribunal.’

Anyone who receives a penalty but believes they do not need to be in the self assessment system can call HMRC on 0845 900 0444 and ask for the penalty to be cancelled. The ICAEW Tax Faculty welcomed the new initiative, designed to mitigate the effect of a rule change which sets the penalty at £100 regardless of the amount of tax outstanding.