Self assessment penalties and interest

HMRC looks at two questions on their own terms: did your return arrive on time, and did your tax arrive on time? A return can be filed promptly while the bill stays unpaid, or the tax can be paid on account while the return is weeks late. Each failure has its own scale of charges.

The first filing penalties are fixed amounts rather than a share of the bill, which surprises people who assume a penalty is always a percentage of the tax. For the 2025 to 2026 return, the online deadline is 11:59pm on 31 January 2027, and the same time is the deadline for paying. Our self assessment deadlines guide sets out every date.

The table below sets out the current self assessment regime as published on GOV.UK. HMRC also provides an online estimator, so you can work out roughly what you owe before you contact them.

Interest is not a penalty, and it is charged whether or not you have a good reason for paying late. HMRC's published rate for Income Tax Self Assessment is 7.75% from 9 January 2026, set at base rate plus 4%, so it moves when the Bank of England changes its rate. Repayment interest, which HMRC pays you if you have overpaid, was 2.75% from the same date. These were the rates shown on GOV.UK when we checked in November 2026.

Interest also applies if you reduce your payments on account and the final bill turns out higher, which is explained in our guide to payments on account.

A separate penalty can apply if you should have registered and did not. GOV.UK describes the failure to notify penalty as based on the amount still left to pay, so it is not a fixed figure. LITRG, the Low Incomes Tax Reform Group, explains that if you tell HMRC after 5 October but pay your income tax in full by 31 January, HMRC should reduce any late notification penalty to zero. Paying on time is therefore worth a great deal even when registration has slipped.

GOV.UK says that if you have a reasonable excuse, you can appeal against a penalty. It describes a reasonable excuse as something that stopped you meeting a tax obligation for a valid reason. Its examples include:

• a partner or another close relative dying shortly before the deadline
• an unexpected stay in hospital that prevented you from dealing with your tax affairs
• a serious or life-threatening illness
• your computer or software failing while you were preparing your online return
• a fire, flood or theft that prevented you from completing your return
• postal delays you could not have predicted

Its list also includes problems with HMRC's own online services, delays related to a disability or mental illness, and relying on someone else to send your return when they did not. GOV.UK also lists excuses that will not be accepted, such as a payment failing because you did not have enough money, finding HMRC's online system too difficult, not getting a reminder from HMRC, or making a mistake on your return. Whatever the excuse, you must send your return or payment as soon as you are able to once the problem has passed.

People within Making Tax Digital for Income Tax come under a points-based regime instead. Each missed deadline earns one point, and a £200 penalty applies at the threshold of 4 points. GOV.UK states that there are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year. Late payment works differently too: for 2026 to 2027, tax 31 or more days late attracts 3% of the tax owed at day 15 and 3% at day 30.

Everything here is general information rather than tax advice. If a penalty letter has arrived and you would like help, our self assessment tax returns page explains what an accountant can do, and every enquiry sent through get in touch is read; where we can, we will put you in touch with a local accountant who can look at the letter with you.