Tax return fines to rise steeply, HMRC says (Full Article).
People who send in their tax returns late will now have to pay much higher penalties than before.
Previously, filing the returns after the annual 31 January deadline would lead to a £100 fine.
Now, extra fines will ratchet up at a rate of £10 per day, leading to penalties of hundreds of pounds.
HM Revenue & Customs (HMRC) said the new penalties were aimed at a “hard-core” of taxpayers who regularly failed to submit their paperwork on time.
Another big change to the penalty regime is that the fines will no longer be cancelled if the taxpayer owes no money to HMRC, because there was no extra tax to pay or because it had been paid.
“There are always a small number of people who have avoided filing or paying on time,” said an HMRC spokesman.
“HMRC spends a lot of time pursing late returns and getting involved in unnecessary appeals work.
“The old £100 penalty was not much of a deterrent and these new penalties, which increase over time, will get people to submit returns as soon as possible,” the spokesman added.
‘No get out of jail’
The updated rules are being targeted at a minority of the 9.2 million people in the self-assessment tax system.
They all have to send in paper returns by 31 October each year, or online by 31 January.
HMRC estimates that about 5% of these taxpayers have problems assembling the necessary information and filing in the forms on time.
But it estimates that another 5% do not care because, under the old regime, they knew that they would escape any fine because they had no tax to pay.
“There is no longer a ‘get out of jail free’ card,” said the HMRC spokesman.
