One million at risk of new tax penalties

UP TO one million self-assessment taxpayers could be hit hard by strict new late payment rules coming into force in October.

Under the new HM Revenue & Customs penalty regime, those just a day late filing their returns will be fined 100. After three months, an extra 10 a day is levied for each day overdue, up to 900, with stricter fines kicking in after six months and a year. Almost a million people have filed their returns late each tax year since the self-assessment system started in 1997, with many failing to file within 12 months. Those taxpayers would not previously have been charged, provided all the tax due was paid, but that will no longer be the case.