Worried About Missing an MTD Quarterly Deadline?

Here's How HMRC Penalties Actually Work

Most people assume missing a Making Tax Digital filing means an instant fine. The good news is that isn't how it works. You don't get an automatic £100 fine on day one.

Under MTD, HMRC uses a points-based system instead. Miss a quarterly filing and you pick up one penalty point. On its own, that point doesn't cost you anything. It's only once the points add up that a fine kicks in.

For quarterly filers, the threshold is four points. Rack up four, and HMRC issues a £200 fixed penalty. After that, every further missed deadline costs another £200, for as long as you stay at the threshold.

So how do you protect yourself? Start with the basics: set reminders and submit on time, even if it's a zero return. A missed deadline still costs a point whether there's anything to report or not.

If you do miss one, don't panic. A single point won't fine you, so there's no need to scramble. The key is not letting it become a habit, since the points do build up over time.

And if you've got a genuine reason, you're not stuck with the point. A health crisis, a software crash, or another reasonable excuse can be grounds to appeal and have the point cancelled.

▶ Watch Our Detailed Breakdown

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Need help getting your MTD set up before the deadline? Comment "MTD" below and we'll help you file on time.

— Artifin Accountants

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