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New penalty regime for late payment of VAT and late filing of VAT returns

The new penalty regime was due to be introduced on 1 April 2022, however this has now been delayed until 1 January 2023.  The new regime will replace the current default surcharge regime.  Taxpayers will receive a point every time they miss a submission deadline. HMRC will notify them of each point. At the relevant threshold of points, a financial penalty of £200 will be charged and the taxpayer will be notified.  When a taxpayer has reached their threshold, a penalty will be charged for that failure and every subsequent failure (but the points total will not increase further).  Points will have a lifetime of two years.  The penalty thresholds will be as follows:

  • Annual submission – penalty threshold 2 points
  • Quarterly submission – penalty threshold 4 points
  • Monthly submission – penalty threshold 5 points.

For more information, please click here.