The question was asked by a Conservative MP with the Treasury detailing the next steps
MPs have been given an update about a crackdown on unpaid taxes as a key date for returns looms. More than 6.36 million taxpayers have submitted their tax return and nearly 5.65 million still need to complete their self-assessment form before the deadline, officials have warned.
Those who miss the deadline on January 31 could face an initial late filing penalty of £100, followed by possible further penalties up to a maximum of £900. The £100 fixed penalty applies even if there is no tax to pay or if the tax due is paid on time.
At the start of the week, a question was raised about what HM Revenue and Customs (HMRC) is doing to collect tax from people and companies who have yet to pay.
The updated answer came as Joe Robertson, the Conservative MP for Isle of Wight East, asked the Chancellor of the Exchequer: “What assessment HMRC has made of the number of individuals and companies that are liable for tax but are not currently being actively pursued for payment.”
The question for the Treasury was answered by Dan Tomlinson, the Labour MP for Chipping Barnet, who also currently holds the Government post of Exchequer Secretary (HM Treasury).
He replied this week: “HMRC is committed to closing the tax gap further and tackling non-compliant behaviours such as tax evasion, tax avoidance, criminal attacks, error, failure to take reasonable care, hidden economy activity, legal interpretation issues, and non-payment.”
The answer came as millions of businesses and private individuals were warned they could face penalties of up to £900 if they don’t complete their tax returns by January 31. According to the revenue service, people must have told HMRC by October 5, 2025 if you need to complete a tax return for the previous year [2024] and you have either not sent a tax return before or you have registered before but did not need to send a tax return for the tax year 2023 to 2024.
If you registered after October 5 of last year, HMRC will send you a letter or email with a different deadline to send your tax return by. This will be 3 months from the date on the letter or email.
It warns: “You must still pay the tax you owe by 11:59pm on January 31, 2026 or you’ll get a penalty.”
If you send your tax return late, you’ll get the following late filing penalties:
- an initial £100 penalty
- after 3 months, additional daily penalties of £10 per day, up to a maximum of £900
- after 6 months, a further penalty of 5% of the tax due or £300, whichever is greater
- after 12 months, another 5% or £300 charge, whichever is greater
If you pay your tax late, you’ll get penalties of 5% of the tax unpaid at:
You’ll also be charged interest on the amount owed. To avoid this, pay your Self Assessment tax bill as soon as possible.
Addressing the issue, Tomlinson continued: “In 2024 to 2025, HMRC’s compliance work contributed to record tax revenues of £875.9 billion, collecting and protecting £48 billion of tax that would have gone unpaid if HMRC hadn’t stepped in – up from £41.8 billion the previous year.
“At the Autumn Budget 2025, the government announced a package of measures that will raise a further £2.4 billion in additional tax revenues in 2029 to 2030. This builds on announcements at Autumn Budget 2024 (£6.5 billion), and Spring Statement 2025 (over £1 billion) and brings the total revenue from closing the tax gap announced this Parliament to £10 billion in 2029 to 2030.”
The Secretary added that there is a checklist that is followed to ensure people who need to pay tax follow the rules, which are often split into three stages. He explained: “HMRC pursues unpaid tax liabilities through a number of routes.
“Those who have not paid will be subject to initial telephone and letter campaigns to encourage swift payment. HMRC also uses private sector debt collection agencies to pursue outstanding amounts. Cases will move between these different stages of the debt collection process as part of being worked.”
When it comes to payments which “remain outstanding”, he further notes that “HMRC has a range of enforcement powers to address the small minority of taxpayers who deliberately refuse to pay or engage, such as taking control of goods, recovering debt through county court proceedings, and applying to make a company or person insolvent.”
You can find information on lost tax revenue and when HMRC stops chasing a debt in its official GOV.UK. Rather than grouping people by who they are or how far along they are in the payment process, HMRC organises its records based on the specific type of tax that is overdue.
You can also read the written questions and answers on the UK Parliament here.
