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Self Employment Late Filing Tax Penalties 2018/19

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  • Post published:February 12, 2021

Late Filing Tax Penalties

This month I have received numerous telephone calls from individuals in prison, that have received self-assessment tax penalties.

HMRC have recently sent out individual £300 tax penalties for non-filing of the 2018/19 self-assessment tax return that should have been filed by 31 January 2020.

The penalty relates to the fact that the tax return is already six months late.

Tax Penalties for Late Filing

Ta penalties for late submission are worked out as follows: –

  • 1 day – £100 penalty
  • 3 Months – £10 daily penalty for up to ninety days (maximum £900)
  • 6 Months – higher of 5% of tax due or £300
  • 12 Months and later – higher of 5% of tax due or £300

Each tax year can therefore accumulate tax penalties of £1600.

However what HMRC have not made clear is the fact that although they are charging the penalties for 2018/19. They have said they will not be charging the daily penalties.

HMRC says that this in recognition of the exceptionally difficult circumstances many taxpayers faced during the Covid-19 pandemic.

HMRC will however still be charging the 6 month and 12 monthly penalties. This would explain the flurry of phone calls I have received as the £300 penalties have just been sent out.

What does this mean for You?

Basically, if have you entered prison and were self-employed in the tax year 2018/19 it is important to make a written appeal against these penalties.

The good news is that HMRC have confirmed that they will consider the impact of Covid-19 as a reasonable excuse for missing filing deadlines.

Remember you cannot appeal a penalty if you have not filed the outstanding self-assessment tax return.

Interestingly, HMRC do not consider entering prison as ‘reasonable excuse’, so it is important to appeal any 2018/19 penalties after you have filed your self-assessment tax return.

COVID-19 – Self Employment Tax Penalties, Payment Arrangements

As part of the Winter Economy Plan on 24 September 2020, The Chancellor announced ‘enhanced payment arrangements’ for those taxpayers that face the ‘tax Armageddon’ on 31 January 2021.

This because self-employed taxpayers face the following amounts due on 31 January 2021: –

  • Deferred second on account payment for 2019/20
  • Balancing payment for 2019/20
  • First on account payment for 2020/21

With self employment late tax filing penalties, as long as the tax liability is below £30,000, the amount of tax due can be spread over twelve months.

Interest will be applied though on outstanding balance from 1 February 2021. This is in contrast with the deferral of the second payment on account due in July 2020, on which no interest was charged!

Where you have tax debt whilst in prison the most important thing you can do is communicate with HMRC or contact The Tax Academy (see details below).

You can also ask a family member to contact us through our contact page

HMRC ‘Nudge Letters’

HMRC has recently announced a new campaign of ‘nudge letters’ that are sent to taxpayers as a prompt to ensure that a correct and accurate tax return is being submitted.

Were you to receive one of these letters, rest assured, HMRC are not targeting simply because you are in prison but is partly part of an educational campaign to inform taxpayers of the correct reporting procedures.

The letters will signpost you to relevant HMRC guidance and a dedicated helpline. Remember, if you are not sure what the letter is about contact Paul at the Tax Academy.

2019/20 Self-Assessment Tax Return – 31 January 2021 deadline

The current deadline to file the 2019/20 self-assessment tax return (the tax year that finished on 5 April 2020) is currently due electronically on 31 January 2021.

As I write this article there is pressure on HMRC to defer the filing deadline for three months.

There is precedent for this as Companies House have already extended filing deadlines for limited companies by three months. We will wait and see on this one!

Remember, The Tax Academy CIC can assist you with filing your self-assessment tax returns particularly for those that have worked in the Construction Industry.


Remember to contact The Tax Academy CIC to review your tax affairs to ensure they are up to date.

There is nothing worse than being released from prison and finding that you have tax penalties and tax debt that need to be resolved with HMRC, particularly when going self-employed.

Please contact Paul Retout from The Tax Academy CIC on 01824 704535 or write to me: –

The Tax Academy CIC,

Unit 4 Ffordd Yr Onnen,

Lon Parcwr Business Park,



LL15 1NJ.

Paul is a tax specialist, tax author and founder of The Tax Academy CIC.

On behalf of all of us at The Tax Academy CIC we wish you all Very Happy New Year!