°Ç¸ç³Ô¹Ï

Changes to penaltiesÌý

IfÌýyou’reÌýusing Making Tax Digital for Income Tax,Ìýnew penalties will replace the current late submission andÌýlate paymentÌýpenalties that apply to your personal tax return.ÌýÌý

The new penalties will not apply to the following Self Assessment tax returns:

• non-resident company (submitted on behalf of the company) Ìý
• trust or estate (submitted by a trustee) Ìý
• partnership (submitted by a nominated partner)

Current late payment and lateÌýsubmissionÌýpenalties will still apply to these tax returns.

There are no changes to howÌýlate paymentÌýinterest works.Ìý

When the new penalties will apply to youÌý

Changes to late submission penalties andÌýlate paymentÌýpenalties will apply to youÌýfrom the taxÌýyearÌýyou join Making Tax Digital for Income Tax.Ìý

You canÌýfind out if and when you need to use Making Tax Digital for Income Tax.Ìý

The current penalties will still apply to previous tax years. For example, if you use Making Tax Digital for Income Tax from 6 April 2026, current penalties will apply to your 2025 to 2026 tax return deadline of 31 January 2027.

Deadlines for payments and submissionsÌý

The new penaltiesÌýapplyÌýif you missÌýthe deadlines for sending your quarterly updates, submittingÌýyour tax return or payments.

The deadline toÌýsubmitÌýyour tax return and pay any tax you owe is 31 JanuaryÌýafter the end of the tax year.

Quarterly updates for the 2026 to 2027 tax yearÌýÌý

You still need to keep digital records andÌýsend quarterly updatesÌýbefore you canÌýsubmitÌýyour tax return.

TheÌýquarterly updateÌýdeadlinesÌýare:Ìý

• 7 AugustÌý
• 7 NovemberÌý
• 7 FebruaryÌýÌý
• 7 MayÌý

Late submission penaltiesÌý

The new late submission penalties are points based.Ìý

For each quarterly update (for tax yearsÌýafterÌý2026 to 2027)ÌýorÌýtax returnÌýdeadlineÌýyouÌýmiss,Ìýyou’llÌýget a penalty point.

The penalty point threshold is 4 points.ÌýIf you reach this,Ìýyou’llÌýget a:

• £200Ìýpenalty
• £200Ìýpenalty each time you missÌýanotherÌýsubmission deadline

You can only get one penalty point per deadline. This applies even if you have more than one business andÌýsendÌýmore than oneÌýquarterly updateÌýlate (for tax yearsÌýafterÌý2026 to 2027).

Late paymentÌýpenaltiesÌý

The newÌýlate paymentÌýpenalties are more proportionate to how long it takes you to pay what you owe.ÌýÌýÌýÌý

Late paymentÌýpenalties apply to payments not paid in full, by the relevant due date. This includes:Ìý

• aÌýbalancing paymentÌýforÌýanÌýoutstanding amount on your tax billÌý
• amounts due following an amendment or assessmentÌýon your tax returnÌý

Late paymentÌýpenalties do not apply to anyÌýpayments on accountÌýthat you may need to make.ÌýÌý

If you getÌýa late paymentÌýpenalty, the penalty amount depends on how long it takes you to pay what you owe. The sooner you pay yourÌýoverdue amount, the lower the penalty amount will be.Ìý

These penalties are not pointsÌýbasedÌýand will applyÌýto eachÌýlate payment.Ìý

From the first day your payment is late, until you pay in full, we’ll also charge late payment interest.

WhenÌýlate paymentÌýpenalties applyÌý

In your first year of new penalties,Ìýyou have 30 days from the payment due date to either:

• make full paymentÌý
• contact HMRC toÌýset up a payment planÌý

After 30 days,Ìýwe’llÌýstart to apply penalties.ÌýAfter your first year, this reduces to 15 days.ÌýÌý

You will only receive the 30-day period once — if you have volunteered and are now required to use Making Tax Digital for Income Tax, you will continue to have 15 days.

The following table shows howÌýlate paymentÌýpenalties will apply, depending on the tax year the payment is for.

	Penalties for 2026 to 2027 tax year	Penalties for 2027 to 2028 tax year
Payment up to 15 days late	No penalty	No penalty
Payment 16 to 30 days late	3% of theÌýtax owed atÌýday 15, or no penalty ifÌýit’sÌýyour first year	4% of the tax owed at day 15, or no penalty ifÌýit’sÌýyour first year
Payment 31 days or more late	3% ofÌýtheÌýtax owed atÌýday 15, andÌý3% ofÌýtheÌýtax owed atÌýday 30 Plus, an annual rate of 10% per year on the outstanding amount, charged daily from day 31 until the tax is paid, or for up to 2Ìýyears	4% of the tax owed at day 15, and 4% of the tax owed at day 30 Plus, an annual rate of 10% per year on the outstanding amount, charged daily from day 31 until the tax is paid, or for up to 2 years

If you cannot pay on timeÌý

Contact HMRC as soon as possible ifÌýyou’reÌýhaving difficulty payingÌýyour Income Tax by the deadline.Ìý

YouÌýcanÌýavoid penalties by contacting HMRC as soon as possible to discuss whether youÌýcanÌýset up a payment planÌýand pay by instalments.Ìý

If a payment plan is agreed and you make the payments, penalties will be pausedÌýfrom the dateÌýyou contacted us.ÌýÌý

You may be charged a penalty if:Ìý

• a payment plan cannot be agreedÌýÌý
• youÌýdo notÌýfollowÌýtheÌýagreed planÌýÌý

Removing penalty points and penaltiesÌýÌý

If you’re below the 4-point threshold, we’ll automatically remove each point 24 months after the missed deadline.

If you reach the 4-point threshold, individual points will not automatically be removed. Instead, you will need to meet 2 conditions to remove all your penalty points.  Ìý

To remove all your penalty points you need to: Ìý

• send your quarterly updates and submit your tax return on time for 12 months Ìý
• send any outstanding quarterly updates and submit any outstanding tax returns for the previous 24 months

 You can sign in to your HMRC online services account to see the date your points will be removed. Ìý

In some exceptional circumstances, such as insolvency, HMRC may cancel a penalty or penalty point, or remove all penalty points.Ìý

Making an appealÌý

We will send you a letter if you get a:Ìý

• late paymentÌýpenaltyÌý
• late submission penalty pointÌý
• £200 late submission penaltyÌý

If you do not agree withÌýthe penalty point or penaltyÌýyou canÌýappeal. Your letter will tell you how to do this.Ìý

If you become exemptÌý

If your circumstances change, you may becomeÌýexemptÌýfromÌýMaking Tax Digital for Income Tax.ÌýÌý

If you become exempt in the 2026 to 2027 tax year you will return to theÌýcurrent late payment and lateÌýsubmissionÌýpenaltiesÌýfor Self Assessment.Ìý

If you become exempt in the 2027 to 2028 tax year:Ìý

• you will remain under the new penaltiesÌý—ÌýfromÌýApril 2027, the new penalties will apply toÌýeveryone whoÌýsubmitsÌýaÌýpersonal Self AssessmentÌýtax returnÌýÌý
• your penalty point threshold will decrease from 4 points to 2 points

If you already have penalty points

If you already have penalty points when your point threshold changes from 4 to 2, your points willÌýreduceÌýso thatÌýyou are no closerÌýtoÌýyour new threshold.ÌýÌý

For example, if you have 3 penalty points,ÌýyouÌýare 1 point away from your 4-point threshold.ÌýIfÌýyou then become exempt,Ìýyour points would reduce to 1. This meansÌýyou’reÌýstill 1 point awayÌýfrom theÌý2-pointÌýthreshold.