£100 fine for a late return even if no tax due

 

Simon Read
Friday 25 January 2013 21:00 GMT
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Fines can add up to £1,600 to your tax bill
Fines can add up to £1,600 to your tax bill (Rex Features)

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Taxpayers who fail to file their tax returns by next Thursday will be hit by hefty fines, even if they don't owe any money.

HM Revenue & Customs (HMRC) introduced a new, tougher penalty system last year and it's caught out many used to the previous more lax system.

Accountancy firm UHY Hacker Young reckons the new system has already earned HMRC hundreds of millions of pounds more in penalties than in previous years, thanks to higher and more numerous penalties sent to taxpayers for missing key deadlines.

Mark Giddens, head of private client services at the firm, said: "The new penalty system means fines for taxpayers late in submitting forms even when they have no tax to pay, which will come as a shock to those receiving unexpected penalties."

"Even taxpayers who are owed money by HMRC in the form of a rebate could now be fined for not filing a tax return on time."

Being one day late in filing your tax return will cost you £100, even if there is no tax due. Further penalties will apply if your return is three, six or 12 months late.

The fines can add up to £1,600 to your bill on top of interest and surcharges.

"If you have left it to the last minute, try not to panic," advised Mr Giddens. "Make sure all income and gains are reported, and make sure you don't make simple mistakes like confusing 'net' or 'gross' tax figures."

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