What penalties apply for later filing or payment of Corporation Tax?
This is a freeview 'At a glance' guide to Corporation Tax penalties.
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What penalties apply for Corporation Tax?
Corporation Tax penalties are, in general, set out in the combined penalty regime, which applies across all the direct taxes, with some exceptions as set out below.
Late filing penalties
- Late filing penalties are covered by the rules in Schedule 18 of Finance Act 1998.
- The combined Late filing penalty regime under Schedule 55 Finance Act 2009 does not extend to Corporation Tax.
Late filing penalties: Filing date before 1 April 2026
Where the filing date is before 1 April 2026, the rules are:
| Lateness | Penalty | Reference |
| Missed filing deadline | £100 | Para 17 Sch 18 FA 98 |
| 3 months late | £100 | Para 17 Sch 18 FA 98 |
| 6 months late | 10% of unpaid tax | Para 18 Sch 18 FA 98 |
| 12 months late | 10% of unpaid tax | Para 18 Sch 18 FA 98 |
The flat rate penalties are increased if the failure to meet the filing deadline is the third consecutive failure:
| Lateness | Penalty | Reference |
| Missed filing deadline | £500 | Para 17 Sch 18 FA 98 |
| 3 months late | £500 | Para 17 Sch 18 FA 98 |
| 6 months late | 10% of unpaid tax | Para 18 Sch 18 FA 98 |
| 12 months late | 10% of unpaid tax | Para 18 Sch 18 FA 98 |
The normal filing deadline date is 12 months after the accounting period end. This is extended to the deadline for submitting the relevant accounts to Companies House if later. Ordinarily, the due date for accounts is 9 months after the accounting period end.
Late filing penalties: Filing date on or after 1 April 2026
It is proposed that where the filing date is on or after 1 April 2026, the government will increase the level of fixed late filing penalties, as shown below:
| Lateness | Total penalty at current rate | Total penalty at new rate |
| Missed filing deadline | £100 | £200 |
| 3 months late | £200 | £400 |
| Third consecutive failure, missed filing deadline | £500 | £1,000 |
| Third consecutive failure, 3 months late | £1,000 | £2,000 |
Late payment
There are no late payment penalties for Corporation Tax. Interest is charged on outstanding tax due. There are penalties where companies that are under the quarterly payment regime deliberately fail to pay or deliberately make a payment that is too small. See Corporation tax instalment payments
Security against non-payment
From 6 April 2019, HMRC has the power to require securities in relation to:
- Corporation Tax and
- CIS deductions
- Where an HMRC officer considers that it is necessary for the protection of the revenue.
- There will be a right to review by HMRC and a right to appeal to the tribunal against a decision to request security or as to the amount, terms or duration of the security.
- Failures to comply with a request for security will be a criminal offence and subject to fines.
Record keeping
A company which fails to keep adequate records in relation to an accounting period is liable to a penalty of up to £3,000.
Incorrect returns
Errors in returns are covered by Schedule 24 Finance Act 2004. See Penalties: Errors in Returns and Documents (subscriber version).
Failure to produce documents
HMRC has powers to inspect company documents and records, these may extend to the company owners, contained in Schedule 36 Finance Act 2008. See Penalties: Schedule 36 information notices.
Useful guides on this topic
Adviser’s Tax Penalty Planner
A guide to the key direct and indirect tax penalty regimes for returns and payments, excluding VAT.
How to appeal a tax penalty
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Penalties: Failure to Notify
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Penalties: Late filing
Late returns can be subject to a mix of fixed and tax geared penalties. What penalties apply for late filing? Which penalty will apply and when?