HMRC issues 500,000 £1,200 penalty notices

16 August 2012

Get any interesting post this morning? Perhaps you have one of those cards that says the postman couldn’t be bothered to knock on your door or try and push your parcel through the letterbox? Maybe you got an energy bill for hundreds of pounds to add to the energy company’s stinking big profits? Or perhaps you got a penalty notice from HMRC for £1,200.

The bad news is that, if you failed to send in your 2010/11 tax return, due by 31 January 2012, this sum is entirely correct, being £300 late filing fixed penalties (£100 fine every three months from and including  31 January onwards) added to £900 in 90 days of £10 a day fines since the start of May. Just don’t say we didn’t warn you.

HMRC suggest that 500,000 people will be getting these penalties which equates to approximately 6% of issued returns. That’s a nice little £600 million earner for HMRC following this year’s rule change on penalties. Previously you could get the penalty reduced if you owed no tax; this is no longer the case and if you should have completed a return, even if you have paid all you owe, you are still liable for the £1,200.

However, another change this year is that HMRC are willing to remove people from their system if they genuinely had no reason to complete a return, which would be a very good reason why no return was completed. An HMRC spokesperson confirmed that "We recognise that there will be some people within this group who do not need to be in self-assessment, and we will be happy to remove them from the system and cancel their penalty."

If you think this may be you, rather than hoping the penalty will go away by itself (it won’t) you should call 0845 900 0444 and tell HMRC so they can stop those nasty brown envelopes landing on your doormat. Well, some of them anyway.

This handy infographic from HMRC explains in simple terms whether you can be removed from the system and escape the penalty.

HMRC infographic

If you end up with “you must complete and send a tax return”, it’s too late. You are in for £1,200. How hard is it to complete a tax return in 9 months. Or even 13 months (at which point the penalty would have been a mere £200). You only have yourself to blame.

TOPICS:   Tax

4 comments

  • Late
    [quote] being £300 late filing fixed penalties (£100 fine every three months from and including 31 January onwards)[/quote] [quote]How hard is it to complete a tax return in 9 months. Or even 13 months (at which point the penalty would have been a mere £200). You only have yourself to blame.[/quote] Not sure where to start with the errors there... You usually get around ten months (5 April until 31 January) if you're filing online, not nine months. Not sure what the 13 months thing is about. If you submit in early February you're on for a £100 penalty. If you submit in April the penalty is unchanged, at £100. If you submit during May the penalties will be somewhere between £110 and £410, depending on the date. There's no automatic £100 penalty at 30 April. Automatic £10 penalties kick in from that date, however (hence the penalty for submitting in May being dependent on the date of submission). And throughout the article you're constantly referring to £1,200 of penalties - which should actually be £1,300: £100 on day one, £900 for ninety days of £10, and £300 (or 5% of the tax due, whichever is the higher) when 6 months late.
  • Ralph M.
    Yesterday's paper telling yesterday's news So how can you tell me you're lonely, And say for you that the sun don't shine? Sorry Sam, but that you were a bit Dawson on that one.
  • Andy D.
    How many different pseudonyms are you planning to comment as 'Ralph'? That's nine this month.
  • Make 1.
    Sorry Andy, I'm not counting. I'm no longer posting under the one name mainly because I can't be bothered getting into rows without inane little troll scrotes so a throwaway username makes it a lot easier. A situation which wouldn't have arisen had anyone at BW bothered paying attention to what was going on, I'm only really coming back on here out of habit and boredom. I think BW lost all credibility quite a while ago and despite the odd decent article mainly from Sam it's now just full of rehashed old tripe sourced from other sites.

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