In addition to the late filing penalties for UK tax returns discussed here, any tax that remains owing to HM Revenue under the Self Assessment system can be expected to give rise to a late payment penalty:
- Payment made more than 30 days late – 5% of the tax owing
- Payment made more than 6 months late – 5% of the tax owing
- Payment made more than 12 months late – 5% of the tax owing
Interest is also added to late paid tax at the prevailing rate.
If a taxpayer sets up a time to pay agreement with HM Revenue the penalty is suspended – but the penalty will be resurrected if the agreement is broken.