This part of GOV.UK is being rebuilt – find out what beta means

HMRC internal manual

Compliance Handbook

Penalties for Failure to Pay on Time: Rules for specific taxes: Income Tax and Capital Gains Tax (IT & CGT): Overview

The penalty rules for failure to pay income tax and capital gains tax in full and on time start for balancing payments due on 31 January 2012. The penalty rules do not apply to payments on account.

To decide whether a person is liable to a penalty you need to know the due date and the penalty date.

The due date for the balancing payment of income tax and capital gains tax is 31 January next following the year of assessment, although it can be later if the tax return was issued late.

The penalty date is 31 days after the due date. This means that 31 days after the usual due date of 31 January a penalty date of 3 March, or 2 March in a leap year. However, see CH155200 where the income tax is payable under an assessment in the absence of a return, or as a result of the amendment or correction of a return.

A person is liable to

  • an initial penalty if an amount of income tax or capital gains tax is unpaid at the penalty date, and
  • two further penalties if an amount remains unpaid 5 and 11 months after the penalty date.