What penalties and interest changes affect late UK Self Assessment and Corporation Tax filings in 2024/25?

Understanding what “changes in 2024/25” really means

The 2024/25 tax year runs from 6 April 2024 to 5 April 2025. When people ask what penalties and interest changes affect late UK Self Assessment and Corporation Tax filings “in 2024/25”, they often mean one (or more) of the following:

First, they may mean penalties and interest that apply to returns and payments connected to the 2024/25 tax year (even if the filing deadline falls later, such as 31 January 2026 for online Self Assessment). Second, they may mean changes that took effect during the 2024/25 window itself and therefore affect how interest is calculated on late payments happening in that period. Third, they may mean changes announced around that time that start to bite on deadlines and liabilities that fall shortly after the year ends.

For most taxpayers and companies, the headline “change” in this area is not a brand-new penalty regime for Self Assessment or Corporation Tax returns. The familiar late filing penalty structures for both remain broadly the same. The key practical change is the way HMRC’s late payment interest is set from April 2025, which can increase the cost of paying late even if the penalty amounts themselves have not changed.

Self Assessment: the late filing penalties (and how they stack up)

Self Assessment has two separate charging tracks that people often mix up:

• Late filing penalties (you filed the tax return after the deadline).

• Late payment penalties and interest (you did not pay the tax you owe on time, even if you filed the return).

Late filing penalties are triggered by missing the filing deadline, regardless of whether you ultimately owe any tax. That can surprise people who assume “no tax due” means “no penalty risk”. In practice, HMRC can charge a late filing penalty even when the tax bill is nil, because the penalty is about compliance with the filing obligation.

Self Assessment late filing: the standard timeline

For most individuals filing online, the usual deadline is 31 January after the end of the tax year. For the 2024/25 tax year (6 April 2024 to 5 April 2025), the online filing deadline is typically 31 January 2026. If you miss that date, penalties can accumulate in stages:

• Immediately after the deadline: an initial fixed penalty of £100.

• After 3 months late: daily penalties of £10 per day can apply, up to 90 days (maximum £900).

• After 6 months late: an additional penalty, generally the higher of £300 or 5% of the tax due.

• After 12 months late: a further additional penalty, generally the higher of £300 or 5% of the tax due (with potential for higher, behaviour-based charges in more serious cases).

A crucial point: these are late filing penalties. They can apply even if you paid what you owe on time, and even (in many cases) if you owe nothing. The simplest way to stop the filing penalties escalating is to submit the return as soon as you can, even if you cannot pay the full tax bill yet. Filing and paying are connected, but the penalty systems are separate.

Self Assessment late payment: penalties are percentage-based

Late payment penalties are different from late filing penalties. They are calculated as a percentage of the unpaid tax and are triggered by how long the payment is overdue. Under the standard Self Assessment rules, if you pay your tax late you can be charged penalties of 5% of the tax unpaid at each of these points:

• 30 days late

• 6 months late

• 12 months late

These late payment penalties sit on top of late payment interest, which accrues on the outstanding amount for the time it remains unpaid.

In other words, a late Self Assessment bill can become more expensive in two ways at once: you may face percentage penalties at set milestones, and you will generally face interest for every day the tax remains outstanding.

What changed for Self Assessment in 2024/25: the interest rate mechanism

Even if the penalty structure looks familiar, late payment interest is where 2024/25 becomes important.

Historically, HMRC’s late payment interest has been linked to the Bank of England base rate, plus a set margin. During the 2024/25 tax year itself (6 April 2024 to 5 April 2025), that margin remained at the previous level for late payment interest. But from 6 April 2025, the margin used to calculate late payment interest increased. That means that for many real-life Self Assessment situations connected to 2024/25 liabilities, the interest calculation may be split across two regimes:

• Interest on late payments up to 5 April 2025: calculated using the earlier margin (base rate plus the prior uplift).

• Interest on late payments from 6 April 2025 onwards: calculated using the higher margin (base rate plus a larger uplift).

Why does this matter for 2024/25 Self Assessment? Because the payments and deadlines don’t all fall neatly inside the tax year. A large proportion of Self Assessment cashflow happens in January and July, and late payments can easily straddle April 2025.

A practical Self Assessment example: payment on account and the April 2025 switch

Many Self Assessment taxpayers make “payments on account” towards the next year’s bill. For 2024/25, the two payments on account are commonly due on:

• 31 January 2025 (first payment on account for 2024/25)

• 31 July 2025 (second payment on account for 2024/25)

If you miss the first payment on account due on 31 January 2025, interest typically starts accruing from early February 2025. If you then pay late after 6 April 2025, your interest charge for that one overdue amount may be calculated in two slices: one slice at the pre-6 April 2025 rules and a second slice at the post-6 April 2025 rules. The later you pay, the more days fall under the higher-margin regime.

Separately, if you miss the second payment on account due on 31 July 2025, the whole late period occurs after 6 April 2025, so the higher-margin interest mechanism is relevant throughout the overdue period.

Does this change your penalty risk, or just your interest cost?

For most people dealing with ordinary late Self Assessment payments, the timing of interest is what changed around 2024/25, not the underlying late filing penalties. The late payment penalty milestones (30 days, 6 months, 12 months) remain the key trigger points for penalties. But the interest amount you end up paying can be materially higher for late periods that fall after 6 April 2025.

This distinction is important for planning. If cashflow is tight, you may be weighing whether to prioritise filing, paying, or both. Filing stops the filing penalties escalating, while paying reduces (or stops) both the late payment penalties (by reducing the unpaid balance at the milestone dates) and the daily interest cost.

Self Assessment: common “gotchas” that increase penalties and interest

Late charges can escalate quickly when small misunderstandings compound. Here are the patterns that most often lead to larger bills than people expect:

• Assuming filing and payment are the same deadline. For online Self Assessment, filing and payment are often both due by 31 January, but they are separate obligations with separate consequences.

• Not realising a £100 filing penalty can apply even when no tax is due. If you were required to file, missing the deadline can still trigger the fixed penalty.

• Missing the 3-month mark. The daily penalties (up to £900) can be a nasty surprise if you leave the return unfiled beyond three months.

• Making a payment, but allocating it incorrectly. If payment is not matched to the correct liability (for example because of a reference error), your Self Assessment account may still show tax as outstanding, allowing interest to keep running.

• Letting the 30-day late payment milestone pass. Once that point hits, a 5% late payment penalty can be charged on the unpaid amount, in addition to interest.

Corporation Tax: late filing penalties for the Company Tax Return

Corporation Tax has its own structure, and again it helps to separate the concepts:

• Company Tax Return filing penalties (late submission of the CT600 and supporting accounts/computations).

• Late payment interest on Corporation Tax paid after its due date.

For most companies, the Company Tax Return is due 12 months after the end of the accounting period. If you file late, HMRC charges fixed penalties that step up over time:

• 1 day late: £100

• 3 months late: another £100

• 6 months late: HMRC may estimate your Corporation Tax bill and add a penalty of 10% of the unpaid tax

• 12 months late: another 10% of any unpaid tax

There is also an important repeat-offender rule: if your Company Tax Return is late three times in a row, the £100 fixed penalties increase (commonly to £500 each for the 1-day and 3-month penalties). This means the “same delay” can cost far more if your company has a history of late filing.

Corporation Tax payment deadlines: why interest often matters more than penalties

For many companies, the Corporation Tax payment due date is earlier than the filing due date. A common rule of thumb for smaller companies (not in quarterly instalments) is that Corporation Tax is due 9 months and 1 day after the end of the accounting period, while the return is due 12 months after the period end.

This creates a real-world pattern: a company may file the CT600 late (triggering filing penalties), but it may also have been late paying the tax several months earlier (triggering interest for a longer period). Conversely, a company might file on time but pay late, which can still be expensive due to interest.

What changed for Corporation Tax in 2024/25: again, the interest rate mechanism

The same HMRC late payment interest framework generally applies across taxes, including Corporation Tax. This is where the key “2024/25” change appears again: from 6 April 2025, the margin used to calculate late payment interest increased.

If your company’s Corporation Tax payment due date falls after 6 April 2025 (or if it fell before then but the company paid after 6 April 2025), the interest accruing after that date is calculated using the higher-margin approach. This is particularly relevant for companies with accounting periods ending in mid-2024 through early-2025, where the “9 months and 1 day” payment date can fall in 2025 and easily run beyond 6 April 2025 if missed.

A practical Corporation Tax example: year end 30 June 2024

Imagine a company with an accounting period ending on 30 June 2024. In a typical non-instalment scenario:

• Corporation Tax payment due date would be around 1 April 2025 (9 months and 1 day after 30 June 2024).

• Company Tax Return filing due date would be 30 June 2025 (12 months after the period end).

If the company misses the payment date and pays late in May 2025, interest would accrue from the due date. The late period includes days both before and after 6 April 2025. That means the interest calculation could be split, with the later part of the late period costing more per day under the post-6 April 2025 rules. Meanwhile, if the company also files after 30 June 2025, the filing penalties start at £100 and can escalate if the delay continues.

Are there late payment penalties for Corporation Tax?

In many straightforward cases, companies mainly face interest for paying Corporation Tax late rather than a separate “percentage late payment penalty” that mirrors Self Assessment. The bigger penalty exposures in Corporation Tax commonly relate to late filing, inaccuracies, or more specific regimes such as large company instalment payment rules. That’s why the 2024/25 interest change can be the most noticeable “new” cost lever for ordinary Corporation Tax lateness: even without an extra late payment penalty, higher interest can materially increase the cost of delay.

What did not change in 2024/25 (but people often expect to)

When headlines talk about HMRC enforcement, it’s easy to assume the penalty tables for Self Assessment and Company Tax Returns must have been rewritten. In reality, most taxpayers and many companies are still operating under the familiar step-based filing penalty structures described above.

That does not mean your risk is unchanged. Inflation, cashflow pressures, and higher interest rates can make “the same” penalty regime feel harsher. A £100 fixed penalty is the same number, but it may be harder to absorb. And when interest costs rise, the overall cost of lateness grows even if penalty tables stand still.

How interest and penalties interact when you partially pay

Both in Self Assessment and Corporation Tax, partial payments can reduce future charges, but the mechanics differ depending on what you owe and when you pay.

For Self Assessment late payment penalties (5% at set milestones), reducing the outstanding balance before a milestone date can reduce the penalty charged at that milestone, because the percentage is applied to the tax still unpaid at that time.

For interest, every pound you pay earlier generally reduces the amount on which interest is calculated going forward. So even if you cannot clear the full bill, paying something can slow the interest build-up, particularly after 6 April 2025 when the interest margin increased.

For Corporation Tax, the same broad idea applies for interest: paying sooner reduces the principal outstanding and therefore reduces ongoing interest. Filing penalties for a late Company Tax Return, however, are linked to how late the return is, not to how much you have already paid.

Reasonable excuse, appeals, and damage control

When you are already late, your priorities should usually be:

• File as soon as possible to stop late filing penalties escalating (Self Assessment daily penalties after 3 months can be particularly painful; Corporation Tax penalties escalate as lateness continues, and repeat lateness can increase fixed penalties).

• Pay as much as you can as soon as you can to reduce interest and reduce exposure to percentage late payment penalties where they apply (especially Self Assessment).

• Check HMRC messages and notices carefully so you understand exactly what is being charged (filing penalty, late payment penalty, interest, or a mix).

• Consider whether you have a reasonable excuse for being late and, if so, whether an appeal is appropriate. A successful appeal can remove or reduce penalties, though interest is generally charged based on lateness of payment even where penalties are waived.

In cashflow difficulty situations, many taxpayers and businesses explore payment arrangements. Even when a payment plan is agreed, interest may still run on outstanding amounts, but avoiding further enforcement action and preventing matters from escalating can be a major practical benefit. The earlier you engage, the more options you usually have.

Key takeaways for 2024/25 Self Assessment and Corporation Tax lateness

If you remember only a few points, make them these:

• Self Assessment late filing penalties are staged and can apply even if you owe no tax. £100 starts it, daily penalties can follow after 3 months, and further penalties can be charged after 6 and 12 months.

• Self Assessment late payment penalties are separate and are based on 5% of tax unpaid at 30 days, 6 months, and 12 months. Interest is added on top.

• Corporation Tax late filing penalties for the Company Tax Return start at £100 and escalate, with 10% tax-geared penalties at 6 and 12 months late. Repeated lateness can increase the fixed penalties.

• The most significant “change” around 2024/25 is the late payment interest mechanism from 6 April 2025. Many late payments connected to 2024/25 liabilities occur after that date, increasing the cost of delay even if penalty tables look familiar.

• Filing quickly is often the fastest way to stop penalties escalating, even if you cannot pay in full immediately. Paying anything sooner rather than later reduces interest and can reduce percentage late payment penalties where they apply.

A simple checklist to minimise penalties and interest going forward

To finish, here is a practical checklist you can apply whether you are an individual taxpayer or a company:

• Know your deadlines (Self Assessment filing and payment dates; Corporation Tax payment date and CT600 filing date).

• Separate filing from paying in your planning: aim to file on time even if you need a plan to pay.

• Calendar the “penalty milestones” (Self Assessment: 1 day, 3 months, 6 months, 12 months; Corporation Tax filing: 1 day, 3 months, 6 months, 12 months).

• Watch the interest clock: interest runs day-by-day, and the post-6 April 2025 setting can make prolonged lateness more expensive.

• Pay with the correct reference so the payment is allocated correctly and interest does not keep accruing unnecessarily.

• Act fast if something goes wrong: a quick filing and a partial payment can materially reduce the final cost.

In 2024/25, the penalty frameworks for late Self Assessment and late Company Tax Return filings remain recognisable, but the cost of being late can still rise noticeably because interest on late payments becomes more expensive once the April 2025 change is in play. For most taxpayers, the best defence is still the same: file promptly, pay as early as you can, and treat the “milestone dates” as non-negotiable.