How much is the MTD late submission penalty?

£200, charged when you reach 4 penalty points, and £200 again for each further missed deadline.

Do penalty points expire?

Below the 4-point threshold, each point is removed automatically 24 months after the missed deadline. At or above the threshold you must file on time for 12 months and clear any outstanding submissions from the previous 24 months.

What are the penalties for missing MTD deadlines?

Checked against GOV.UK on 14 August 2026

Short answer

One point per missed submission. At 4 points you get a £200 penalty, then £200 for each further miss.

Making Tax Digital replaces the old late-filing penalties with a points system, for both quarterly updates and your tax return. A single slip does not cost you money.

How points work

One penalty point for each missed quarterly update or tax return deadline
The threshold is 4 points
Reach 4 points and you get a £200 penalty — and another £200 each time you miss another submission deadline
Only one point per deadline, even if you have several businesses and send several updates late
If you are registered for VAT, your MTD for Income Tax points are separate from your VAT points

The first-year concession

There are no penalties for missing a quarterly update deadline for the 2026 to 2027 tax year. Penalty points still apply to a late tax return in that year. From 2027 to 2028, late quarterly updates carry points.

Getting points removed

Below 4 points

Each point is removed automatically 24 months after the missed deadline.

At or above 4 points

Points do not expire on their own. To clear them all you must do both: send your quarterly updates and tax returns on time for 12 months, and send any outstanding updates and returns from the previous 24 months. You can see the removal date in your HMRC online services account.

Volunteers have a different threshold

While you are volunteering for MTD, penalties do not apply to late quarterly updates at all. Penalty points do still apply to late tax returns, and for volunteers the threshold is 2 points before the £200 penalty.

Appeals

HMRC sends a letter for a late payment penalty, a late submission penalty point, or a £200 late submission penalty. If you disagree you can appeal, and the letter tells you how.

Late payment penalties are different →

Sources

General information about UK tax rules, not tax advice. Your own circumstances and HMRC's official guidance govern your position. If you are unsure, speak to an accountant or contact HMRC. Tax rules change — if this page is more than a few months old, check the GOV.UK pages linked above. Found an error? Email hello@getaxionlabs.com and we will correct it.

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