{"id":116576,"date":"2026-01-10T11:30:00","date_gmt":"2026-01-10T11:30:00","guid":{"rendered":"https:\/\/en.econostrum.info\/uk\/?p=116576"},"modified":"2026-01-10T11:26:26","modified_gmt":"2026-01-10T11:26:26","slug":"12-million-people-risk-of-heavy-fines-hmrc","status":"publish","type":"post","link":"https:\/\/en.econostrum.info\/uk\/12-million-people-risk-of-heavy-fines-hmrc\/","title":{"rendered":"12 Million People at Risk of Heavy Fines Under New HMRC Penalty Rules"},"content":{"rendered":"\n

As the January 31 deadline<\/strong> for Self Assessment tax returns approaches, HMRC (Her Majesty\u2019s Revenue and Customs) has unveiled significant changes to its penalty system. Starting from the end of this month, taxpayers who miss the deadline will face steeper fines and potentially higher interest rates on late payments. With around 12 million individuals expected to file their returns, it\u2019s essential that taxpayers are aware of the new rules to avoid hefty charges.<\/p>\n\n\n\n

For many Brits, the Self Assessment deadline looms large at the end of January. Failure to submit tax returns on time could result in escalating penalties, which are now structured to encourage timely compliance. According to a report from Birmingham Mail<\/em>, the revised penalty system includes both daily fines and additional charges for late payments. The change comes as part of HMRC’s ongoing efforts to streamline tax collection and reduce the number of overdue returns.<\/p>\n\n\n\n

Increased Penalties for Late Filings<\/h2>\n\n\n\n

One of the most significant adjustments to the penalty structure is the introduction of daily fines for late submissions. As previously reported, individuals who miss the January 31 deadline will incur an immediate \u00a3100 fine<\/strong>. If they still fail to file after three months, an additional \u00a310 <\/strong>per day will be added, up to a maximum of \u00a3900<\/strong>. This is a clear signal from HMRC that filing tax returns on time is taken seriously, with financial consequences for delays.<\/p>\n\n\n\n

Furthermore, if the tax return remains overdue for more than 30 days<\/strong>, taxpayers will face a 5% penalty<\/strong> on the amount owed. Should the payment be delayed further, an additional 5%<\/strong> charge applies at the six-month mark, followed by another 5%<\/strong> at 12 months<\/strong>. These late payment penalties are designed to encourage compliance and avoid what HMRC refers to as “tax debt accumulation.” According to HMRC, the penalty system<\/a> aims to ensure fairness, rewarding those who pay on time and applying financial pressure to those who don’t.<\/p>\n\n\n\n

Interest Rates on Late Payments Revised<\/h2>\n\n\n\n

Along with the increased penalties, HMRC has also adjusted the interest rates applied to late payments. As reported in the same source, the interest rate on unpaid taxes is set at the Bank of England’s base rate plus 4%<\/strong>. This means that, starting from February, the interest rate on late payments will be reduced from 8% to 7.75%<\/strong>, following a recent cut in the Bank of England’s base rate. While this may seem like a small decrease, it remains a crucial consideration for taxpayers who are already facing the risk of penalties.<\/p>\n\n\n\n

Late payment interest is an essential part of the tax system, and HMRC <\/a>has stated that its current policy aligns with international standards. According to the tax authority, the aim is to make the process fairer by encouraging prompt payments<\/strong> while also offering a level of compensation to those who have overpaid their taxes. The revised interest rates remain an important factor for anyone considering delaying their tax return payment, as the cost of procrastination could still be significant.<\/p>\n\n\n\n

HMRC’s updated penalty system for late Self Assessment tax returns is designed to discourage delays and ensure timely payments. The new fines and revised interest rates will affect millions of taxpayers <\/strong>across the UK. While the changes may bring some relief for those struggling with late payments, it is clear that HMRC intends to apply stronger financial pressure to ensure deadlines are met. With the clock ticking toward the January 31 deadline,<\/strong> it is critical for individuals to file their returns promptly to avoid unnecessary penalties and interest.<\/p>\n","protected":false},"excerpt":{"rendered":"

HMRC\u2019s updated penalty system is set to hit millions of taxpayers across the UK. With escalating fines and interest rates, late tax returns could cost you more than ever.<\/p>\n","protected":false},"author":10,"featured_media":116578,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[29],"tags":[],"class_list":["post-116576","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-taxation","generate-columns","tablet-grid-50","mobile-grid-100","grid-parent","grid-33","no-featured-image-padding"],"_links":{"self":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/116576","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/comments?post=116576"}],"version-history":[{"count":2,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/116576\/revisions"}],"predecessor-version":[{"id":116583,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/posts\/116576\/revisions\/116583"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media\/116578"}],"wp:attachment":[{"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/media?parent=116576"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/categories?post=116576"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/en.econostrum.info\/uk\/wp-json\/wp\/v2\/tags?post=116576"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}