Late taxpayers face '£60-a-day fines'

Taxpayers complain the form is over-complicated

Taxpayers face fines of £60 for every day they are late with their tax returns, the chairman of the Inland Revenue (IR) has reportedly warned.

Sir Nicholas Montagu told The Times the "rather fierce" fines would be "an extremely powerful deterrent".

The crackdown will see the IR target first persistent offenders - those 75,000 who have still not settled their bill for 1997 - followed by the 412,000 who have missed the January and July deadlines for last year's tax returns.

The only way that people can put an end to the £60-a-day penalty is by filing their tax return

Sir Nicholas Montagu
IR chairman

The new £60-a-day accumulating penalty will be added to the existing fines for late payment.

Five years after the launch of self-assessment more than one in every 10 of the 9.2 million people required to complete tax returns each year incur penalties by missing a series of deadlines - despite a £40m advertising campaign.

They pay £100 late-payment fines every year and almost half of those incur a further £100 fine, a 5% surcharge on the unpaid debt plus interest at 6.5%.

Taxpayers complain the 10-page self-assessment tax return is over-complicated.

"Levying daily penalties is an extremely powerful deterrent," Sir Nicholas told The Times.

'Security breach'

"Guidance has gone out to our area directors to tell them that they should, in every case where people resolutely don't put in a return that's due, consider penalties.

"The only way that people can put an end to the £60-a-day penalty is by filing their tax return."

Fewer than 80,000 people have used the Revenue's online self-assessment service since its launch in April 2000 - despite a £10 discount.

It was suspended in June after a security breach allowed some people's confidential information to be read by others.