Late filing penalty for tax return.

Troy_af

Hello.

So I have been sent a letter from HMRC saying I have £1200 in penalties for my tax return not being sent on time. This is true, I'm not arguing it, it was filed late due to two reasons. I am serving in the armed forces and I was deployed and not able to be contacted in any way for the majority of the year and also I am using a 3rd party tax refund company who due to the covid pandemic also suffered with delays.

Anyway, my agent has said that the will appeal and sound very confident that the appeal will be accepted. But regardless it is still myself who is faced with the fine. My question is would it be better to pay it any way and hope for a refund, or leave it until a decision is made by HMRC? If I leave it how much interest will be added? I read up it was 3% I believe but is this per day or what? Also does anyone have any experience or has heard of successful penalty appeals? Considering the letter states that acceptable excuses could be your computer doesn't work or postal problems, I thought mine was a pretty reasonable excuse.

Thanks for any help.

Troy_af

Oh Ive also spoke with two HMRC agents online, one who said interest will accumulate on the amount due the other who said that there is no interest on penalties. Yet the letter also says it would be better just to pay because if you appeal successfully you will get refunded but if you don't you will pay interest.

Dazed_and_C0nfused

The rates are here, currently 3% but increasing soon to 3.25%.  Per year.

https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates

If you pay and are successful with an appeal the amount overpaid would be set against anything else owed on your Self Assessment account.

If nothing is owed you can get it refunded.  Unless you have signed something to say repayments can be made to your agent.  In which case they would get it.

Troy_af

Dazed_and_C0nfused said:

The rates are here, currently 3% but increasing soon to 3.25%.  Per year.

https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates

If you pay and are successful with an appeal the amount overpaid would be set against anything else owed on your Self Assessment account.

If nothing is owed you can get it refunded.  Unless you have signed something to say repayments can be made to your agent.  In which case they would get it.

Thanks.

Is this definitely for all penalties? The HMRC agent on the chat said in my case the interest is nil.

Well I don't owe anything, I'm owed a refund from HMRC. If it's the sake of 3% per year then I think it would be best for me not to pay it and appeal.