Corporation Tax Late Filing Penalties Explained

Corporation tax late filing penalties doubled for returns with a filing date on or after 1 April 2026 — the first increase since 1998.

£100 became £200. The second £100 became a second £200. Most published guidance, including a lot of accountancy firm content, still quotes £100.

The catch is in the wording. The change turns on the filing deadline, not the date you actually file. Two companies whose year ends are a month apart can face completely different penalty regimes for exactly the same behaviour.

The penalties

Only the flat penalties changed. The two tax-geared penalties at six and twelve months remain at 10% of unpaid tax each.

The filing-date rule, with dates

Your CT600 filing deadline is twelve months after the end of your accounting period. Which regime applies depends on where that deadline falls — not when you get round to filing.

A company with a 31 March 2025 year end that files its return in late 2027 still faces the old £100 penalties, because its filing deadline was 31 March 2026. A company with a 30 April 2025 year end that files a week late faces £200, because its deadline was 30 April 2026.

If guidance elsewhere quotes £100, check when it was written. Anything not updated since spring 2026 describes a regime that has closed for almost every live accounting period.

Late three times in a row

File late three consecutive times and the £200 flat penalties become £1,000 each.

That means a company more than three months late on the third consecutive occasion is looking at £2,000 in flat penalties alone, before any tax-geared penalty. Consecutive means consecutive accounting periods, so a company that files a day late three years running triggers it just as effectively as one that files six months late.

For returns with a filing date before 1 April 2026 the flat penalties were £100 each and the repeat uplift was correspondingly smaller.

The six-month determination cannot be appealed

At six months late, HMRC stops waiting. They issue a determination — their own estimate of your corporation tax bill — and add a penalty of 10% of the unpaid tax.

You cannot appeal a determination. There is no reasonable excuse route, no review, no tribunal. The only way to displace it is to file the return and pay the corporation tax actually due. HMRC then recalculates the interest and penalties.

If HMRC’s estimate is higher than your real liability — and it often is, because they are working from limited information — the determination stands until you file, and interest runs on the determined amount in the meantime.

Penalties apply even if you owe nothing

A loss-making company that files late pays £200. So does a dormant company that has been issued a notice to deliver a Company Tax Return and does not file.

The flat penalties are for the failure to file, not the failure to pay. If your company is genuinely dormant, tell HMRC — they will usually stop issuing notices, but until they do the obligation stands.

Late payment is a separate charge

Filing penalties and payment interest are different things with different triggers.

• Corporation tax is payable nine months and one day after the accounting period ends. Missing that date triggers interest at 7.75%, charged daily and uncapped
• The CT600 is due twelve months after the accounting period ends. Missing that date triggers the flat penalties above

You can be on time for one and late for the other. Paying the tax in full on time does not protect you from a £200 filing penalty, and filing on time does not stop interest running on tax you have not paid. If HMRC owes you money, repayment interest runs at 2.75%.

Reasonable excuse

You can appeal a late filing penalty if you have a reasonable excuse — something that stopped you meeting the obligation for a valid reason.

What may count:

• The death of a partner or another close relative shortly before the deadline
• An unexpected stay in hospital that prevented you dealing with tax affairs
• A serious or life-threatening illness
• Computer or software failure while you were preparing the return
• Problems with HMRC’s online services
• Fire, flood or theft
• Postal delays you could not have predicted
• Delays related to a disability or mental illness
• Being unaware of, or misunderstanding, your legal obligation
• Relying on someone else to send the return, where they did not

What will not count:

• A cheque that bounced or a payment that failed because there were insufficient funds
• Finding HMRC’s online system too difficult to use
• Not receiving a reminder from HMRC
• Making a mistake on the return

Two of those are worth flagging. Relying on an accountant who did not file, and misunderstanding your legal obligation, both appear on HMRC’s list of things that may count. That is a meaningfully different position from Companies House, which explicitly refuses reliance on an accountant, accountant’s illness, unfamiliarity with the rules and postal delays as excuses for late accounts.

May count is not will count. HMRC assesses each case, and you must file as soon as you are able to.

How to appeal

File the Company Tax Return first. HMRC will not consider an appeal until the return has been submitted.

Then appeal online through HMRC’s late filing penalty appeal service. Two practical points: the form cannot be saved and returned to, so complete it in one sitting, and once completed you print it and post it to the address shown on the form.

Have these ready before you start:

• The company’s Unique Taxpayer Reference
• The date on the penalty notice
• The penalty amount
• The end date of the accounting period the penalty relates to
• Your explanation of why the return was not filed by the deadline

Companies House penalties are a separate regime

Late accounts at Companies House carry their own automatic penalties, unchanged in 2026:

These double if accounts are filed late in two successive financial years, and Companies House has no discretion over whether to issue them. A company that files everything late gets both sets — separate filings, separate bodies, separate deadlines.

Frequently asked questions

How much is the penalty for filing a corporation tax return late?
£200 immediately, a further £200 at three months, then 10% of unpaid tax at six months and a further 10% at twelve months. These figures apply to returns with a filing date on or after 1 April 2026. For returns with an earlier filing date the two flat penalties were £100 each.

Did corporation tax late filing penalties change in 2026?
Yes. The flat penalties doubled from £100 to £200 for returns with a filing date on or after 1 April 2026 — the first increase since 1998. The change turns on the filing deadline, not the date you actually file, so a return due on 31 March 2026 still attracts the old £100 even if filed much later.

Can I appeal a corporation tax late filing penalty?
Yes, if you have a reasonable excuse. You must file the Company Tax Return before appealing, then use HMRC’s online appeal service. You will need the company UTR, the date on the penalty notice, the penalty amount and the end date of the accounting period the penalty relates to.

Can I appeal HMRC’s tax determination if my return is six months late?
No. A determination cannot be appealed. The only way to displace it is to file the outstanding return and pay the corporation tax actually due, after which HMRC recalculates the interest and penalties.

Do I get a penalty if my company owes no corporation tax?
Yes. The flat penalties are for failing to file, not for failing to pay. A loss-making or dormant company that has been issued a notice to deliver a Company Tax Return and files late still pays £200.

Avoiding the penalty entirely

Every penalty in this article is avoidable, and the flat ones are trivially so — the return has to exist and be submitted, whatever the numbers say.

SmartFiling prepares and files CT600 returns on a fixed fee, including the corporation tax computation, capital allowances and HMRC submission, with a three-week turnaround from receiving your records. Every return is reviewed and signed off by an ICAEW Chartered Accountant.