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

HMRC internal manual

Compliance Handbook

From
HM Revenue & Customs
Updated
, see all updates

Penalties for Failure to File on Time: Other penalty issues: Maximum penalties

A person may incur more than one penalty for failing to file a return on time, but the total of all late filing penalties that are chargeable after 12 months that are calculated as a percentage of the total tax liability from that return must not exceed 100% of the liability to tax for category 1 information. The total late filing penalties that can be charged are higher for category 2 and category 3 information.

The maximum penalties that are calculated as a percentage of the total tax liability are

  Category 1 information Category 2 information Category 3 information
       
Deliberate and concealed 100% 150% 200%
Deliberate but not concealed 100% 150% 200%
All other cases 100% 100% 100%

See CH62260+ for guidance on the three categories of information.

For example

Dominic’s total tax liability for his 2014-15 ITSA is £100,000. He incurred the following penalties.

* 6 month further penalty at 5% of £5,000. 
* 12 month further penalty at 70% of £70,000, for deliberately withholding, but not concealing, information. 

The total tax-geared penalties are 75% of the total tax liability. The above rule provides that the total penalties must not exceed 100% of the total tax liability.

See CH65060 and CH40400+ for guidance on examples about how penalties interact.

FA09/SCH55/PARA17