Weekly Tax Update – Monday 4th April 2011

1. General News

1.1 New regime for penalties for late filing and late payment of tax

HMRC has issued a reminder about the new penalty regime for late filed tax returns and late payment of tax as follows:

"The penalties for filing your tax return late are:

• Day one: you will be charged an initial penalty of £100, even if you have no tax to pay or you have already paid all the tax you owe
• Three months late: you will be charged an automatic daily penalty of £10 per day, up to a maximum of £900
• Six months late: you will be charged further penalties, which are the greater of 5 per cent of tax due or £300
• Twelve months late: you will be charged yet more penalties, which are the greatest of 5 per cent of tax due or £300. In serious cases you face a higher penalty of up to 100 per cent of the tax due.