CH63540 | Penalties for Failure to File on Time: Calculating the penalty: Calculation process: Calculating fixed and daily penalties

A person is liable to fixed penalties, and daily penalties for certain taxes, when they fail to file their return by the filing date.

Fixed penalties

A person becomes liable to an initial fixed penalty of £100 when their return is not filed by the filing date for both

• occasional returns and returns for periods of 6 months or more, see CH62100

• CIS returns, see CH62340, and

• returns for periods between 2 and 6 months, see CH62720.

In addition to incurring the initial fixed penalty,

• a second fixed penalty of £200 is incurred for CIS returns, 2 months after the penalty date, see CH62360, and

• subsequent fixed penalties of £200, £300 or £400 in respect of returns of between 2 and 6 months for further failures within a penalty period, see CH62720.

Fixed penalties are a fixed amount and are not based on the tax liability of the return.

Daily penalties

For occasional returns and returns for periods of 6 months or more, see CH62120, daily penalties of £10 per day can be charged after 3 months from the penalty date. Although £10 is charged each day, the total of the daily charges make up one penalty. The final daily penalties charge is for the lesser of

• the number of days from when the daily penalties first start being charged up to and including the date on which the return is filed, and

• 90 days.

FA09/SCH55/PARA3

FA09/SCH55/PARA4

FA09/SCH55/PARA8

FA09/SCH55/PARA9