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HMRC internal manual

Compliance Handbook

Penalties for Failure to File on Time: Calculating the penalty: Penalty reductions for disclosure: Maximum and minimum penalties

If the person makes a disclosure there are two minimums to consider when charging the 12 month further penalty.

  1. The penalty percentage for the 12 month further penalty cannot be reduced below a minimum penalty percentage.
  2. Once the penalty is calculated the amount of the penalty cannot be less than the minimum penalty amount.

Minimum penalty percentage

The table below shows the maximum and minimum penalty percentages for each type of failure, where the failure was deliberate, or deliberate and concealed, and the failure continued for 12 months. The range of penalty percentages depend on

  • the behaviour in relation to the type of failure, see

    • CH62160+ for income tax, capital gains tax, bank payroll tax and registered pension scheme,
    • CH62400+ for CIS, and
    • CH62740+ for machine games duty, and
  • whether the disclosure is unprompted or prompted, see CH63140.

Type of Disclosure    
    Type of Failure
  Deliberate and concealed  
Unprompted Maximum penalty percentage  
  70% 100%
  Minimum penalty percentage  
  20% 30%
Prompted Maximum penalty percentage  
  70% 100%
  Minimum penalty percentage  
  35% 50%


Note that there are higher maximum and minimum penalty percentages where the disclosure involves an offshore matter, see CH112700.


Minimum penalty amount

As we show above, we can reduce the penalty percentage for the quality of disclosure.

But even when we apply that percentage we cannot reduce the amount of penalty to less than a minimum amount where the failure was deliberate and the return has been outstanding for 12 months. The minimum amount is

  • £300, or
  • for CIS returns,

    • £1,500 where deliberate but not concealed, and
    • £3,000 where deliberate and concealed.

Also see CH62500 where the person is registered for gross CIS payments only.

There are examples of using the minimum penalty percentage and minimum penalty amount in calculating the penalty at CH63620, CH63680 and CH63700.

See also the charts in the overview of calculating the penalty at CH63020.