From 6 April 2011, HMRC have introduced new penalties for late filing of a tax return and late payment of tax for tax years 2010/11 onwards. This applies to personal, trust and partnership tax returns.

Under the new penalty regime, the penalty for late filing for personal and trust returns will no longer be capped at the lower of £100 and the balance of tax outstanding at 31 January.

The penalties for late filing will include:

• £100 penalty immediately after the due date for filing (whether or not the tax has been paid)
• daily penalties of £10 per day for returns that are more than 3 months late, running for a maximum of 90 days
• penalties of 5% of the tax due for the return period (or £300 if greater) for prolonged failures (over 6 months and again at 12 months)

The penalty regime for late payment of any tax due will be:

• a penalty of 5% of the amount of tax unpaid, generally 1 month after the payment due date (or at the filing date of the relevant return)
• further penalties of 5% of any amounts still unpaid at 6 months and 12 months

You will also have to pay interest on all outstanding amounts, including any unpaid penalties, until payment is received.