HMRC is changing the way it calculates tax penalties. These changes will initially apply just to VAT and Income Tax self-assessment. HMRC say this will make things fairer and more consistent ...
Although taxpayers will no longer receive a penalty if they fail to meet certain deadlines. Instead, they will incur points for missed obligations, and when those points hit a threshold, a penalty is applied. This should only penalise a small majority who deliberately miss deadlines rather than those who make a genuine mistake.
After the points threshold is reached, a £200 penalty is applied, and there will be different points totals for each type of submission they are obliged to make. So, a self-assessment tax return has separate points from a VAT return.
You can discover more about this new points system on the HMRC website, and it will also give you further information on the different thresholds for the different kinds of submissions, penalties and commencement dates.
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