The short version: Failure to Notify is a penalty HMRC charges when you don’t tell them about something that affects your tax. New income sources, hitting VAT thresholds, selling a property at a profit. If HMRC should have known and you didn’t tell them, you could face a penalty.
What do you need to notify HMRC about?
Common triggers include starting self employment (if you earn above the trading allowance), reaching the VAT registration threshold, selling a second property or buy to let at a profit, and receiving other untaxed income that pushes you into Self Assessment.
The deadlines vary. Some things need reporting within 30 days, others within 6 months of the end of the tax year. Missing these deadlines is what triggers the penalty.
How much is the penalty?
It depends on how much tax you should have paid and whether HMRC thinks you were careless or deliberate. At the extreme end, penalties can be as high as 100% of the tax owed. If you come forward voluntarily before HMRC catches you, penalties are usually lower.
Can you appeal?
If you had a reasonable excuse (serious illness, bereavement, something genuinely out of your control), you can appeal. But “I didn’t know” usually isn’t enough.
Worried you might have missed a notification deadline? Get in touch and we’ll help you sort it out.
