Penalties for late filing are applied in stages, with the first being a £100 penalty where the tax return is not filed by midnight on 31 January following the end of the relevant tax year, i.e. 31 January 2025 for the 2023/24 year. There are sometimes blanket extensions to the deadline, e.g. during the pandemic, but in other cases a penalty might be waived if the taxpayer has a “reasonable” excuse.

There is good news for sole traders and partnerships for 2023/24 due to the disruption caused by basis period reform. In its latest Stakeholder Digest, HMRC has announced that where such taxpayers requested an overlap relief figure from HMRC before 31 January but did not receive a response by that date, an extension to 28 February will apply. It is not clear from the announcement whether this extension will apply automatically, or whether those affected will need to appeal using a reasonable excuse argument.

The Digest also advises filing the return using estimated figures in the meantime and amending later on. This will allow an estimate of the tax to be paid. Don’t forget, interest will always be added to late-paid tax, even where a late filing penalty is waived.