SAM61050 - Interest, penalties and surcharge: penalties: fixed automatic penalties: late issued returns

This guidance refers to tax returns received for 2009-10 and earlier. For further information regarding the new rules for the tax years 2010-11 and later, see SAM61200 onwards.

The filing date for a tax return is usually

  • 31 October for paper returns

And

  • 31 January for online returns and for those customers who are unable to file online for technical or operational reasons

For years up to 2006-07, the filing date was usually 31 January.

Where a taxpayer fails to file his / her return by the filing date, the SA computer will automatically impose fixed penalties; but only where the year of liability of the return (tax year) ended in the previous calendar year. For example during the calendar year 1 January 2010 to 31 December 2010 fixed automatic penalties will be imposed for 2008-09 tax returns (tax year ending 5 April 2009). Once 1 January 2011 is reached penalties are no longer automatically imposed for 2008-09 returns, the automatic process switches to the following years tax returns 2009-10 (tax year ending 05/04/10).

However fixed automatic penalties will not be imposed where

  • The year of liability of the return (tax year) ends in the previous calendar year but the return is issued late and the due date of the return is later than 31 December of the current calendar year. For example 2008-09 return issued on 24 September 2010 will have a due date of 3 months and 7 days later which is 1 January 2011, a fixed automatic penalty will not be automatically imposed if the return is received late

Or

  • A return is issued for a year of liability ended at least two years before the current calendar year. For example 2007-08 return issued in calendar year 1 Jan 2010 to 31 Dec 2010

Clerical Action will need to be taken to ensure that any necessary penalty is charged.

Whenever you issue a return and

  • The year of liability ended at least two years before the current calendar year

Or

  • The year of liability ends in the previous calendar year and the return is being issued later than 24 September of the current calendar year, you should
    • Make a BF note at the time that the return is issued to review the case after the due date of the return has passed. If the return has been received on or before the due date no further action is required, if the return has not been received or has been received late you should use function AMEND FIXED PENALTIES to charge the first fixed penalty. Note that the record will not be updated immediately - the penalty will be raised and the notice issued in the next batch run (usually monthly)
    • BF the record to review again 6 months after the due date of the return has passed. If the return has been received no further action is required, if the return has been received or has been received later than 6 months following the due date use function AMEND FIXED PENALTIES to charge the second fixed penalty

Note: In these circumstances, you should check whether a deferred filing date has been set, and passed, before proceeding to charge a penalty.

You may come across a case in day to day work where a return has been issued in the above circumstances but no penalty has been charged. You should consider imposing the penalty if applicable. However you should be very careful to check SA notes to see if any compliance or debt management action is underway, if it is contact the appropriate section to ensure that they want to proceed with the imposition of the fixed penalties.