Missed the Self Assessment Deadline? Penalties, Interest and How to Stop Them Growing

In short: if you miss the Self Assessment filing deadline you are charged a penalty straight away, even when you owe no tax. Paying late is penalised separately, and interest runs on the unpaid tax from the day after the due date. Which penalty rules apply to you now depends on whether you are in Making Tax Digital for Income Tax.

Missing the deadline is not a single event with a single cost. Filing late and paying late are two separate failures, each with its own charges, and interest accrues on top of both. The amounts also stop growing at different points depending on what you do next, which is why acting quickly changes the final figure more than anything else. This article is written for a UK resident dealing with a missed or about-to-be-missed deadline, and it sets out what you are charged, which regime applies to you, and what to do first.

What Happens the Moment You Miss the Deadline

The filing penalty is automatic and does not depend on how much tax you owe. Interest on any unpaid tax begins the day after the payment deadline and keeps running until you pay in full.

Two separate clocks start. The first measures how late your return is and drives the filing penalty. The second measures how late your payment is and drives both the payment penalty and the interest. They are independent, so a person who files on time but pays three months late is charged under the payment rules only, and a person who files eight months late but paid on time is still charged for the late return.

This matters when you cannot afford the bill. Filing the return is free and stops the filing penalties escalating, whatever the state of your bank account. Holding the return back because you cannot pay adds a second set of charges to a problem you already have.

Which Penalty Rules Apply to You

Two regimes are running side by side. The new penalties apply from the tax year you join Making Tax Digital for Income Tax. The current penalties continue to apply to earlier years and to everyone not yet in it.

HMRC applies the new penalties from the tax year you join Making Tax Digital for Income Tax, not from the date you joined. Earlier years keep the old rules. If you were required to use Making Tax Digital from 6 April 2026, the current penalties still govern your 2025 to 2026 tax return and its 31 January 2027 deadline.

From April 2027 the new penalties apply to everyone who submits a personal Self Assessment tax return, whether or not they are in Making Tax Digital. Three return types stay outside the new rules and keep the current penalties: partnership returns submitted by a nominated partner, trust and estate returns submitted by a trustee, and non-resident company returns.

If you become exempt from Making Tax Digital during the 2026 to 2027 tax year, you return to the current penalties. If you become exempt during 2027 to 2028 you stay on the new penalties, but your points threshold falls from four to two.

Late Filing Penalties Under the Current Self Assessment Rules

The charges stack rather than replace one another, so a return that is a year late carries every charge below.

• One day late: a fixed £100 penalty, charged even if you owe no tax or are due a refund.
• Three months late: daily penalties of £10 a day, for up to 90 days, so up to £900 on top of the £100.
• Six months late: a further penalty of 5% of the tax due or £300, whichever is greater.
• Twelve months late: another 5% of the tax due or £300, whichever is greater, and more in the most serious cases.

A worked example shows how quickly the fixed charges outgrow the tax. Someone who owed £1,200 and filed thirteen months late faces the £100 fixed penalty, £900 of daily penalties, £300 at six months because 5% of £1,200 is only £60, and a further £300 at twelve months, giving £1,600 of filing penalties on a £1,200 bill, before any payment penalties or interest.

The daily penalties are the reason the three-month mark matters more than any other date. Filing before it caps your filing exposure at £100.

Late Payment Penalties Under the Current Rules

Under the current rules you are charged 5% of the tax still unpaid at 30 days, again at six months, and again at twelve months, with interest running throughout.

Each charge is calculated on the amount still outstanding at that moment, not on the original bill, so a part payment reduces every later penalty as well as the interest. Paying half the bill before the 30-day mark halves the first 5% charge.

You must pay a penalty within 30 days of the date on the penalty notice. Agreeing a Time to Pay arrangement with HMRC before a penalty date can prevent the surcharge arising, although interest continues to run on the outstanding amount.

The New Penalties If You Are in Making Tax Digital

Late filing becomes points based rather than an immediate fine, and late payment is charged in stages that reward paying quickly. There is no change to how late payment interest works.

Late Submission Points and the £200 Penalty

You receive one penalty point for each missed quarterly update or tax return deadline. The threshold is four points. On reaching it you are charged £200, and a further £200 each time you miss another deadline after that. You can only receive one point per deadline, even if you run more than one business and send more than one update late.

There are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year. You must still keep digital records and send the updates before you can submit your tax return. The quarterly deadlines are 7 August, 7 November, 7 February and 7 May.

Points below the threshold are removed automatically 24 months after the missed deadline. Once you reach four points they do not expire on their own. You must then file everything on time for 12 months and submit any outstanding updates and returns from the previous 24 months before the points are cleared.

Late Payment Charges Under the New Rules

These charges are not points based and apply to each late payment separately. They apply to a balancing payment and to amounts due after an amendment or assessment, but not to payments on account. In your first year under the new penalties you have 30 days from the due date to pay in full or contact HMRC about a payment plan before charges start. After that first year the window is 15 days, and you only ever get the 30-day version once.

• Up to 15 days late: no penalty under either tax year.
• 16 to 30 days late, for 2026 to 2027: 3% of the tax owed at day 15, or nothing if it is your first year.
• 31 days or more, for 2026 to 2027: 3% of the tax owed at day 15 and 3% of the tax owed at day 30, plus an annual rate of 10% charged daily from day 31 until you pay, for up to two years.
• 16 to 30 days late, for 2027 to 2028: 4% of the tax owed at day 15, or nothing if it is your first year.
• 31 days or more, for 2027 to 2028: 4% at day 15 and 4% at day 30, plus the same annual rate of 10% charged daily from day 31.

The structure rewards speed in a way the old 5% surcharges did not. Paying on day 14 costs nothing in penalties, and paying on day 29 costs one charge rather than two.

If You Have a Reasonable Excuse

A reasonable excuse is something unexpected or outside your control that stopped you meeting the deadline, and you must put the failure right as soon as the obstacle is gone.

Examples HMRC accepts include a serious illness affecting you or a close relative, a bereavement shortly before the deadline, a failure of HMRC's own online service, a fire or flood that destroyed your records, and postal delays you could not have predicted. The excuse must cover the period of the delay, and you are expected to file as soon as you reasonably can afterwards.

Explanations HMRC generally rejects include not having the money to pay, finding the online system too difficult, a mistake made on your return, and relying on someone else to file who then failed to do so. Gather dated evidence before you claim: medical letters, death certificates, service outage records or correspondence that fixes the timeline.

How to Appeal a Penalty You Have Been Charged

You normally have 30 days from the date on the penalty notice to appeal, and the return itself must be filed before an appeal can succeed.

The appeal route is the same whether the charge arose under Self Assessment or under Making Tax Digital, and the penalty notice itself tells you how to appeal. HMRC issues a decision letter for a late payment penalty, a late submission penalty point and a £200 late submission penalty, and each can be appealed.

If HMRC asked you to file a return and you did not actually need to, you can ask for the notice to file to be withdrawn. Where HMRC agrees and cancels the requirement, the associated late filing penalty falls away with it. Raise this as soon as you receive the penalty rather than paying it and arguing later.

What to Do First If You Still Have Not Filed

File the return before you solve the money problem. Filing stops the filing penalties escalating and costs nothing.

1. Check your HMRC online account for which years are outstanding and what has already been charged.
2. File the oldest outstanding return first, because that is the one accruing the largest charges.
3. Pay what you can immediately, even a part payment, because every later penalty and the interest are calculated on what is still outstanding.
4. Contact HMRC about a payment plan if you cannot clear the balance. Penalties are paused from the date you make contact, provided a plan is agreed and you keep to it.
5. Check whether anything in the delay amounts to a reasonable excuse, and gather the dated evidence now rather than later.
6. Diarise the next deadline, including quarterly update dates if you are in Making Tax Digital.

Frequently Asked Questions

General information for UK residents, based on GOV.UK guidance on Self Assessment penalties and on Penalties for Making Tax Digital for Income Tax. It is not advice for your circumstances. Penalty rules are changing as Making Tax Digital is phased in, so check which tax year your situation falls in before relying on a figure.