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Take the penalty out of self-assessment tax returns with sensible tax planning

take the penalty out of self-assessment with proper tax planning

Self-Assessment submission and self-assessment personal tax is a tricky thing to add into the equation, especially when you have a business and personal life to manage, and here at, we want to help.

I guess my Facebook live update on 27th January reached the 10.7 million people who submitted their self-assessment tax returns before the 31 January deadline 🙂

Almost 746,000 people missed my post and the deadline to file their self-assessment tax return, risking a fine of £100 even if they had no tax to pay, or had paid all of their tax on time.

Whilst it may be too late to avoid the £100 penalty, there’s still time to avoid further penalties, so read carefully if this applies to you!

Submit the return online before 30 April 2018 to avoid additional late tax return penalties

Anyone who still hasn’t submitted their return has until 30 April to submit it online to avoid additional penalties of £10 per day. These daily penalties can continue for up to 90 days (a maximum of £900) and are followed by further charges six and 12 months after the deadline:

  • after six months, a further penalty of 5% of the tax due or £300, whichever is greater;
  • after 12 months, another 5% or £300 charge, whichever is greater.

So don’t delay, get the return submitted!

Pay any outstanding tax by midnight 2 March 2018 to avoid late payment penalties

Interest is charged on tax paid late. However, there is still time to avoid additional penalties for late payment if the tax due by 31 January 2018 is paid by 2 March 2018. Otherwise a penalty of 5% of the tax unpaid is charged after 30 days, six months and 12 months. Note that the 5% penalties don’t apply to payments on account that are paid late. They apply after the balancing payment becomes due, ie. 31 January following the year of assessment.

For example:
Anthony’s balancing income tax payment under self-assessment was £9,000 for 2016/2017. If he doesn’t pay this £9,000 balancing payment by 2 March 2018 the following 5% penalties apply:

Trigger datePenalty
Unpaid by midnight 2 March 2018£450
Unpaid by midnight 1 August 2018£450
Unpaid by midnight 1 February 2019£450

Note that penalties can be suspended if a time to pay agreement is made with HMRC (and complied with).


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