½Û×ÓÊÓƵ

For income tax self assessment (ITSA) taxpayers, the penalty regime described below replaces the harmonised regime at A4.560 from a date to be appointed by the Treasury via regulations¹. For HMRC guidance on the new regime, see Penalties for late payment and interest harmonisation.

For ITSA taxpayers with business or property business turnover of more than £50,000 per year, who will be required to submit digital quarterly updates via Making Tax Digital for income tax (MTD IT) (see A4.172), the new regime takes effect from 6 April 2026. For ITSA taxpayers with turnover above £30,000, it is expected to take effect from 6 April 2027. Further consultation will take place before the regime is extended to businesses with turnover of £30,000 or below². The new regime already applies for VAT. See De Voil Indirect Tax Service V5.302C.

For those joining the MTD IT pilot, the new regime will apply on joining the pilot, but only for annual submissions until MTD IT is mandated⁴. Late payment penalties apply penalties for payment