The following Tax guidance note provides comprehensive and up to date legal information covering:
FORTHCOMING CHANGE: HMRC intends to make wide-ranging changes to the rules on tax penalties, as part of its 'Making Tax Digital' reforms and a wider penalty review, including:
Late submission penalties: Replacing late filing penalties with a new system of late submission penalties using a points-based model—the amount of the penalties has yet to be announced
Late payment penalties: Replacing the current late payment penalties with a hybrid regime of penalties and penalty interest. Half the penalty, which will be an as yet unspecified percentage of the unpaid tax, will arise when a payment is late by 15 days; the second half of the penalty will arise when a payment is late by 30 days; followed by penalty interest from 30 days (at a rate not yet set) (in addition to late payment interest). Suspension of penalties will be available where there are suitable time to pay arrangements put in place with HMRC
The changes to late submission penalties, and to late payment interest and penalties, were intended to be in Finance Bill 2019 (see News Analysis: Legislation day: Draft Finance Bill 2019—Tax administration) but at Budget 2018 the government announced that these measures would be deferred to a future Finance Bill. No timetable was given for implementation of the changes.
This Practice Note explains that penalties may be payable
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