Congratulations to those of you who noticed a decline in blogging output over the past 2 weeks, due to a (hugely enjoyable) two week stint at the Olympics. Watch out shortly for an Olympic-themed post on the taxation of overseas sportsmen. However, before that I turn to the topical subject of self-assessment tax return penalties, with news that HMRC is sending out penalty notices to those 500,000 taxpayers who have still not filed their 2010-11 self-assessment tax returns, due at the end of January 2012 (or more accurately, due to the traditional HMRC 31 January computer meltdown, 2 February 2012). Now that the filing delay is over 6 months, the taxpayers are liable for £900 in daily fines plus a minimum £300 late-filing penalty, which will be 5% of the outstanding tax liability if it exceeds £6,000. My maths reveals that this is a minimum of £600 million in penalties, applying to some 6% of those registered to file a 2010-11 self-assessment return. This actually compares vary favourably to the previous year’s position, when some 900,000 to 1 million people failed to file returns, so perhaps the message is finally getting through that filing a tax return is compulsory rather than optional. No doubt there will be a number of people who do not need to be within self-assessment, whose penalties will presumably be cancelled, and also people who have a reasonable excuse for late filing, such as illness, bereavement etc , although it would be the exception rather than the rule for HMRC to accept that a reasonable excuse could cover a period as long as 6 months. Still, no doubt the majority of penalties are correctly levied, and HMRC is now playing hardball to get the relevant returns submitted, which is their true objective. This is not, however, an objective which they are invariably successful in achieving, as a campaign announced in early July demonstrates. This opened a three month ‘window’ for people who failed to submit self-assessment returns for 2009-10 or earlier years to bring their tax affairs up to date. The incentive for so doing is the likely waiver of any tax-geared penalty in respect of the tax owed, although taxpayers will still have to pay the tax and interest, late submission penalty and surcharges due under the self-assessment regime. This is a generous offer; indeed, those who have already filed late for those years and paid a tax-geared penalty may feel that it is too generous, but it reflects HMRC’s determination to bring the filing of self-assessment returns up to date. It is quite distressing to see a Baker Tilly tax adviser referring to this offer as an amnesty; I have blogged previously on the reasons why HMRC’s various disclosure facilities are not amnesties, and this one is no exception. Where I do have some sympathy with George Bull’s comments is his frustration with the piecemeal nature of HMRC’s disclosure facilities, at least in the way they are publicised. In fact HMRC cannot restrict the terms of a facility to a particular category of taxpayer, and thus anyone can avail themselves of the terms on offer under a particular facility, but they do not go out of their way to make that clear. The idea of a once and for all universal disclosure facility, on the basis that ‘the gloves are off’ once the deadline passes is attractive, and might be more effective in bringing reluctant taxpayers out of the woodwork than the current targeted approach. However morally repugnant the activities of those who peddle artificial tax avoidance schemes and the taxpayers who take them up, this is a timely reminder that their activities are at least legal, whereas those who operate in the black economy and choose to simply disregard their tax obligations in whole or part are engaging in conduct which is not only morally reprehensible but also criminal. Perhaps a clearer picture from HMRC of what such behaviour might lead to in terms of a prison sentence might help to further concentrate minds.