HMRC penalty appeals start with the penalty letter: you usually have 30 days from the date it was issued to appeal, and the appeal succeeds if the taxpayer had a reasonable excuse or the penalty is wrong. The route depends on the tax. Self Assessment uses the online service or form SA370, Corporation Tax has its own online form, VAT starts with an HMRC review, and PAYE and CIS have their own online appeal services.
To appeal an HMRC penalty, check the tax and the date on the notice, file any missing return first, then appeal within 30 days through the route for that tax, giving a dated reasonable excuse and evidence. If HMRC does not agree, you can ask for a statutory review and then go to the tax tribunal.
Key points
- The usual time limit for HMRC penalty appeals is 30 days from the date the penalty was issued. A late appeal needs a reason (GOV.UK: disagree with a penalty).
- Each tax has its own appeal route, so HMRC penalty appeals for one client can run through three or four different channels.
- Late filing and late payment are separate penalties with separate amounts, and each needs its own grounds.
- A reasonable excuse must exist at the deadline, and the return or payment must follow promptly once it ends.
- Companies House late filing penalties are a separate regime with a stricter test and their own appeal process.
Terms used in this guide
- HMRC penalty appeals: challenges to a penalty HMRC has charged, made to HMRC first and then, if needed, to a review officer or the tax tribunal.
- Penalty notice: HMRC’s letter charging the penalty. Its date starts the 30-day appeal window.
- Reasonable excuse: something that stopped the taxpayer meeting a deadline despite taking reasonable care, such as an unexpected hospital stay or an HMRC system failure.
- Direct and indirect tax: for direct taxes (Income Tax, Corporation Tax, PAYE) you appeal to HMRC first; for indirect taxes (VAT, duties) HMRC offers a review in the decision letter.
- Statutory review: a fresh look at the decision by an HMRC officer who was not involved, usually within 45 days.
Which appeal route? HMRC penalty appeals by tax
Most delays in HMRC penalty appeals come from using the wrong channel. The table sets out the route GOV.UK gives for each tax as at October 2026; the penalty notice also prints the route that applies.
| Penalty | How to appeal | Time limit | Practice notes |
|---|---|---|---|
| Self Assessment, individual | Online, or form SA370 by post (GOV.UK checker) | 30 days from the penalty date | The online route runs through the client’s own sign-in; an agent can sign SA370 stating their capacity |
| Self Assessment, partnership | Form SA371 by post | 30 days | Every partner is charged if the partnership return is late |
| Corporation Tax (CT600) | Online form, completed in one go, then printed and posted to the address on the form (GOV.UK) | 30 days | The Company Tax Return must be filed before you appeal |
| VAT (periods from 1 January 2023) | Accept the review offered in the decision letter through the VAT online account, write to HMRC, or appeal to the tax tribunal | 30 days from the offer | Points and £200 penalties are both appealable |
| PAYE late filing (RTI) | “Appeal a penalty” in HMRC’s PAYE for employers service, or in writing (GOV.UK) | 30 days | No print function online, so screenshot the confirmation |
| CIS monthly return | HMRC’s online service, or a letter quoting the UTR and payment reference (GOV.UK) | 30 days from the notice | Appeals cannot be made by phone |
For other direct tax penalties, GOV.UK says to follow the instructions on the penalty letter or send a signed letter to the HMRC office for the return, giving the name, UTR and the reason with dates. Our step-by-step guide to the SA370 form and online Self Assessment appeals covers the paper form box by box.
Late filing vs late payment penalties
A client who files late and pays late gets two sets of penalties. An excuse that explains the late return does not automatically explain the late payment. Lack of money, for example, has no bearing on a late return, and the law excludes it as an excuse for late payment unless it was caused by events outside the taxpayer’s control. Keep HMRC penalty appeals for filing and payment separate, even when the notices arrive in one envelope.
| Tax | Late filing | Late payment |
|---|---|---|
| Self Assessment (not yet in MTD) | £100; then £10 a day after 3 months, up to £900; then 5% of the tax due or £300 at 6 months and again at 12 months | 5% of the unpaid tax at 30 days, 6 months and 12 months, plus interest (GOV.UK) |
| MTD for Income Tax (from the year the client joins) | One point per missed deadline; £200 at 4 points and for each later miss. No points for quarterly updates in 2026/27 | For 2026/27: 3% of tax owed at day 15 and 3% at day 30, then 10% a year from day 31; 30 days’ grace in the first year (GOV.UK) |
| Corporation Tax | £200 at 1 day; another £200 at 3 months; 10% of unpaid tax at 6 and 12 months; £1,000 each if late 3 times in a row | Interest on tax paid after 9 months and 1 day (GOV.UK) |
| VAT | One point per late return; £200 at the threshold (4 points for quarterly returners) | 3% at day 16 to 30; 3% plus 3% from day 31, plus 10% a year daily (GOV.UK) |
| CIS | £100 at 1 day; £200 at 2 months; £300 or 5% of deductions at 6 and 12 months | Interest and penalties if deductions are paid late |
Two details catch practices out. First, the MTD rules only apply from the tax year a client joins MTD, so a client who started in April 2026 still faces the old Self Assessment penalties on the 2025/26 return due by 31 January 2027. Second, a Corporation Tax return more than 6 months late triggers a tax determination, which GOV.UK says cannot be appealed. Filing the return replaces it. See our MTD quarterly deadlines calendar for the new dates.
What makes HMRC penalty appeals succeed
HMRC will cancel a penalty if there was a reasonable excuse or if the penalty was charged in error. Check for errors first, such as a filing date recorded wrongly or a penalty for a client who had asked to leave Self Assessment. These are quicker wins than any excuse.
Where HMRC penalty appeals rely on an excuse, GOV.UK accepts events such as a close relative’s death shortly before the deadline, an unexpected hospital stay, serious illness, computer failure while preparing the return, HMRC online service problems, fire, flood or theft (GOV.UK: reasonable excuses). Pressure of work, no reminder, and finding the system hard to use usually fail. Our guide to HMRC reasonable excuse examples covers each one and the evidence it needs.
What a strong appeal includes
- The taxpayer’s name, UTR, the tax year or period and the date on the penalty notice.
- The deadline that was missed and why, in date order.
- When the excuse started, when it ended and when the return or payment was made.
- Evidence such as discharge papers, error screenshots or an insurer’s reference.
- A clear request: cancel the penalty.
A worked example
A sole trader is admitted to hospital as an emergency on 27 January and discharged on 6 February. The practice had the records since November and the return awaited approval. The client approves it on 8 February and it is filed the same day. The appeal states those dates, attaches the discharge letter and asks HMRC to cancel the £100 penalty. “The client was ill” on its own would give HMRC nothing to accept.
Corporation Tax penalty appeals
Corporation Tax HMRC penalty appeals follow a different process from Self Assessment. GOV.UK’s online form must be completed in one go, so gather the company UTR, the date on the notice, the penalty amount and the accounting period end date before you start. Print the completed form and post it to the address shown. HMRC will not consider the appeal until the CT600 has been filed.
The reasonable excuse test is the same in substance, but the evidence has to explain why nobody at the company could deliver the return. Where the company’s software failed, GOV.UK has a specific form to tell HMRC the return was late because of a computer problem. HMRC’s Company Taxation Manual applies the same “without unreasonable delay” principle once the excuse ends (COM100100).
When HMRC penalty appeals are refused: review and tribunal
- HMRC considers the appeal. For direct taxes the case worker looks again and writes with a decision.
- Review. If HMRC does not agree, you are offered a statutory review by a different officer. Reviews usually take 45 days (GOV.UK: get a review).
- Tax tribunal. If the review upholds the penalty, you can usually appeal to the tribunal within 30 days of the review result letter.
- Payment. For Self Assessment, GOV.UK suggests considering paying the penalty while appealing: if the appeal fails, interest runs on an unpaid penalty; if it succeeds, HMRC repays it with interest.
Running HMRC penalty appeals inside a practice
Penalty letters tend to land on a partner’s desk and wait behind client work, and the 30-day window closes quietly. A simple routine fixes most of that:
- Log every penalty notice the day it arrives, with the tax, amount and the 30-day date.
- File any outstanding return or payment immediately; the appeal is weaker while the failure continues.
- Collect the client’s dates and evidence in writing.
- Draft the appeal on the right route and send it to the reviewing accountant.
- Submit, record the reference and diary a follow-up for 45 days.
In HMRC penalty appeals, the drafting and chasing in steps 1, 3 and 5 can sit with an administrator; the decision to appeal and the wording stay with the qualified accountant. Our HMRC penalty appeal support for practices covers exactly that split. Preventing the next penalty starts earlier, in a planned Self Assessment season with records requested in the autumn.
Companies House penalties sit outside HMRC penalty appeals
Late accounts at Companies House create a separate civil penalty, starting at £150 for a private company filed up to a month late and doubling if accounts are late two years running (GOV.UK). The appeal goes to Companies House, which applies a stricter “exceptional circumstances” test. We cover it separately in how to appeal a Companies House late filing penalty.
FAQs
How do I appeal a late filing penalty?
File the missing return first, then appeal within 30 days of the penalty date. Self Assessment penalties go online or on form SA370 (SA371 for partnerships). Corporation Tax uses GOV.UK’s online form, which you print and post. VAT starts with the review offered in the decision letter. PAYE and CIS have online appeal services. Give dated reasons and evidence in each case.
How long do I have to appeal an HMRC penalty?
Usually 30 days from the date the penalty was issued. If you miss that window you can still ask HMRC to accept a late appeal, but you must explain why it was late. For VAT, the 30 days run from the date of the review offer in the penalty decision letter, and you can ask for more time within that period.
Is there an HMRC penalty appeal form?
For Self Assessment HMRC penalty appeals, yes: SA370 for individuals and SA371 for partnerships, both on GOV.UK. Corporation Tax has an online form that you print and post. For most other direct tax penalties, GOV.UK says to use the appeal form sent with the penalty letter or write a signed letter with the taxpayer’s name, UTR and the reasons, including dates.
Can an agent appeal a penalty for a client?
Yes. Agents handle HMRC penalty appeals for clients when authorised for that tax. An agent can sign SA370 stating their capacity or write to HMRC on the client’s behalf, quoting the reference on the notice. The online Self Assessment appeal runs through the client’s own sign-in, and clients should never share those details. The client should agree the facts in writing first.
What happens if HMRC rejects my appeal?
HMRC will offer a statutory review by an officer who was not involved in the decision. Reviews usually take 45 days. If the review upholds the penalty, you can normally appeal to the tax tribunal within 30 days of the review letter. For direct taxes, you can also go to the tribunal instead of accepting a review.
Get HMRC penalty appeals drafted and tracked
Our penalty appeals service logs each notice, gathers dates and evidence, drafts the appeal on the right route for your review and diarises the follow-up. Your accountants keep the judgement and the sign-off. Book a consultation to set it up before the January peak.
