Overdue Self-Assessment Liabilities and Penalties

This blog covers overdue Self-Assessment liabilities and penalties, why they happen and how to avoid them. The 2025/26 Self-Assessment deadline for filing and payment of tax was 31 January 2026. HMR usually notify taxpayers of the liability due, but it is the taxpayer’s responsibility to pay on time.

Late payment interest and surcharges

Interest charges

Unpaid Self-Assessment tax liabilities from February 2026 will accrue interest daily. HM Revenue & Customs’ late payment interest rate is currently 7.75%, having dropped from 8% on 9 January 2026.

Surcharges

Where a payment is still unpaid for more than 30 days after the due date, a surcharge automatically arises. This initial surcharge is equal to 5% of the tax unpaid at that date.

Any tax unpaid more than six months after the due date for payment is subject to a further surcharge. This further surcharge is again 5% of the unpaid tax. Another 5% surcharge will also apply after 12 months to any unpaid tax.

Late filing penalties

If you submit a tax return after the filing deadline of 31 January, you automatically incur a penalty of £100.

After three months, if the return remains outstanding, additional daily penalties of £10 per day will be charged. These charges continue, up to a maximum of £900. If still not submitted, another penalty will be charged of 5% of the tax due or £300, whichever is greater.

If the return remains outstanding 12 months later, a further penalty of 5% of the tax due or £300, whichever is greater, will be levied. These penalties must be paid within 30 days of the penalty notice.

Assistance

To avoid further interest charges and penalties, it is advisable that payments are made to HM Revenue & Customs as soon as possible.

Depending on the taxpayer’s circumstances, it may be possible to arrange a payment plan with HM Revenue & Customs. This can be done by calling them on 0300 200 3820 and providing the UTR and National Insurance number. Some penalties may not be charged if a payment plan is in place. See further details here: https://www.gov.uk/difficulties-paying-hmrc/pay-in-instalments

If you have received a letter from HM Revenue & Customs regarding your liability and require assistance, please contact your local Perrys branch.