For the 2026/27 UK tax year, a taxpayer misses the 31 January online Self Assessment filing deadline and does not file until 7 months after that deadline, having owed some tax throughout the delay. Under HMRC's penalty rules, which statement correctly describes the penalties that will have accrued by that point (ignoring interest)?
- No penalty applies as long as the tax owed is eventually paid in full, since HMRC's penalties are for late payment, not late filing
- A single flat penalty of £100 applies no matter how many months late the return is filed, since the £100 penalty covers any delay
- The only penalty is 5% of the tax due, charged once, regardless of how many months have passed since the deadline
- An initial £100 flat penalty applies as soon as the deadline is missed, followed by £10-per-day penalties (capped at £900) once the return is 3 months late, and by 7 months late a further penalty of 5% of the tax due or £300, whichever is greater, has also been charged
Why D? And why not the others?
Correct answer: D. An initial £100 flat penalty applies as soon as the deadline is missed, followed by £10-per-day penalties (capped at £900) once the return is 3 months late, and by 7 months late a further penalty of 5% of the tax due or £300, whichever is greater, has also been charged
HMRC's late Self Assessment filing penalties escalate in stages: an initial £100 flat penalty applies as soon as the 31 January deadline is missed, even if no tax is owed; once the return is 3 months late, daily penalties of £10 accrue, capped at a maximum of £900; once it reaches 6 months late, a further penalty of 5% of the tax due or £300 (whichever is greater) is charged; and at 7 months late, all of those stages have already been triggered, so the correct option's description of the £100 penalty, the daily-penalty stage, and the 5%-or-£300 stage having all applied is accurate. The option requiring no penalty as long as tax is eventually paid is wrong because these are filing penalties, triggered by the return being late, entirely separate from any late-payment penalties or interest on the tax itself. The option describing only a single flat £100 penalty regardless of delay length is wrong because the £100 is just the first stage; further daily and percentage-based penalties accrue the longer the return remains outstanding. The option describing a single one-off 5% charge is wrong because it ignores the earlier £100 flat penalty and the daily penalty stage that both precede and accompany the 5%-or-£300 charge.
Source: GOV.UK: Self Assessment tax returns — Penalties