CH155180 - Penalties for Failure to Pay on Time: Rules for specific taxes: Income Tax and Capital Gains Tax (IT & CGT): Penalties: Example
Example of initial and further penalties on an amount of income tax and capital gains tax
Martin delivers his 2011/12 ITSA return showing a balancing payment of £21,000 due on 31 January 2013. But he fails to make any payment. Martin makes some payments at later dates, as shown in the table below.
»Ê¹ÚÌåÓýapp due date is 31 January 2013. Because a payment has not been made on or before 2 March 2013 then a penalty is due. »Ê¹ÚÌåÓýapp penalties are as follows.
| Ìý | Payment | Unpaid Tax | Penalty |
|---|---|---|---|
| Amount due at 31 January 2013 | £21,000 | Ìý | Ìý |
| Initial penalty of 5% on £21,000 at 3 March 2013 | Ìý | £1,050 | Ìý |
| Payment 2 May 2013 | £5,000 | £16,000 | Ìý |
| 5 month further penalty of 5% on £16,000 at 3 August 2013 | Ìý | £800 | Ìý |
| Payment 20 September 2013 | £10,000 | £6,000 | Ìý |
| 11 month further penalty of 5% on £6,000 at 3 February 2014 | Ìý | £300 | Ìý |
| Payment 20 February 2014 | £6,000 | £0 | Ìý |
| Total penalty | Ìý | £2,150 | Ìý |