Challenging HMRC Self Assessment Late Filing Penalties

Taxpayers who have been fined £100 for missing the deadline for self assessment tax returns may be able to have their penalties cancelled, says LITRG.

The Low Incomes Tax Reform Group (LITRG) said that taxpayers who did not submit their 2021/22 tax return online by 31 January 2023 may be able to get the automatic £100 late filing penalty cancelled.

If a taxpayer does not meet HMRC’s criteria for self assessment for a year, they can ask HMRC to withdraw the notice to file a tax return for that year. If HMRC agrees to withdraw the requirement, any late filing penalties for that return will be cancelled automatically.

Taxpayers who feel this might apply are being urged to double-check their circumstances using the ‘Check if you need to send a self assessment tax return’ tool, and if appropriate, telephone HMRC to get the filing requirement removed.

It is important to make this request before filing the return, as HMRC cannot withdraw a filing requirement after the tax return has been filed.

Taxpayers who do not meet these criteria, but who have a reasonable excuse for not filing by the deadline or have special circumstances to report, may contact HMRC to appeal the penalty.

According to HMRC, an estimated 600,000 customers missed the 31 January 2023 self assessment deadline.

Victoria Todd, head of LITRG, said: ‘HMRC automatically charge a £100 late filing penalty when a taxpayer misses their self assessment deadline, regardless of their individual circumstances. However, the law contains safeguards that aim to prevent taxpayers from being penalised in circumstances where those penalties would be unfair.

‘If a taxpayer receives a late filing penalty, they should first consider whether they should have been required to file a self assessment return in the first place.

‘If HMRC agree that a return is not required, then the penalties are cancelled automatically and the requirement to file a tax return for the year removed.

‘For example, a taxpayer may have registered for self assessment in advance of starting self-employment but never commenced their trade. Alternatively, they may have earned less than £1,000 (gross) of trading income in the year, so may be able to get the filing requirement removed on the basis that the income is under the trading allowance.’

Reasonable excuse

If a taxpayer cannot get the filing requirement withdrawn, they can appeal the penalty if they have a reasonable excuse, or there are special circumstances.

‘HMRC define a ‘reasonable excuse’ as something that stopped a taxpayer from meeting a tax obligation which they took reasonable care to meet,’ Todd said.

‘Any circumstances could potentially form the basis of a reasonable excuse, provided the taxpayer took reasonable care. HMRC provide some examples on, which include bereavement, serious illness and IT issues. The taxpayer must file their tax return without unreasonable delay after the excuse ends.’

Insufficiency of funds or inability to pay is not, by itself, a reasonable excuse (or special circumstances) – but the underlying causes may be.

‘Where the lateness can be explained by a reasonable excuse, or special circumstances, the onus is on the taxpayer to demonstrate this to HMRC so they can consider whether it is appropriate to cancel the penalties,’ Todd added.

‘If HMRC do not agree to do so, taxpayers can ask for internal review of the decision and/or appeal to an independent tribunal to decide the matter.’

If you want to find out more about this, or have any questions you want to chat about further, please feel free to get in touch on 07799 435 922 or email

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