Late tax returns could cost you £50 a day fine

Taxpayers face fines of £60 a day for late payment of their tax bills under a new crackdown being launched by the Inland Revenue.

Charges will accumulate on a daily basis and there will be no maximum limit. Taxpayers will not be able to appeal against the penalty.

An Inland Revenue spokesman admitted last night:"It means that the cost of late payment is going to mount up pretty quickly,"

The fines will be targeted at "persistent late payers", classed as those who have submitted their tax returns late for the previous three years. The 75,000 taxpayers who have failed to submit their returns for 1997 will be the first targets, followed by the 412,000 who missed the January and July deadlines for last year's contribution.

Sir Nicholas Montagu, chairman of the Inland Revenue, has ordered the crackdown because one in ten people required to complete tax returns still miss the deadlines for payment. Nine million people are now required to fill in tax returns since the introduction of self assessment in 1997. Many are baffled by the forms and have difficulty using the optional internet service.

The Inland Revenue already has the power to impose daily fines and said trials involving 150 cases in Belfast, Manchester and Preston provided "extraordinarily effective".

About a million people routinely miss the 31 January deadline for the payment of all their tax due for the previous year – incurring an automatic £100 fine. Almost half of these then fail to make an interim payment six moths later, leading to a further £100 penalty.

The Inland Revenue said: "We accept that there will be criticism, but the vast majority of people do pay on time."