Making Tax Digital: sanctions for late submission and late payment

The LITRG welcomes the opportunity to comment further on penalties reform and urge HMRC to communicate the changes to late filing penalties clearly to taxpayers, whichever model is chosen. We do strongly recommend that application of new penalties to Making Tax Digital (MTD) is deferred for up to three years and that the necessary safeguards are in place before the new regime is rolled out. We also express concern at the lack of consultation on fixed penalty amounts and potential disproportionate/regressive impacts on the low-income population.