An estimated 1.1 million self-assessment tax returns were not sent to HMRC by the 31 January deadline, equating to 9.5% of expected returns.

The Government's tax collection authority revealed that over 11.5 million taxpayers filed their self-assessment tax returns for the 2023/24 tax year by this date, avoiding a £100 late filing penalty.

Of the 97.3% of assessments that were submitted online, 732,498 people returned them on the last day, with 31,442 submitting their self-assessments between 11pm and 11:59pm.

Missing a tax return deadline results in an initial £100 fixed penalty, which applies even if there is no tax to pay, or if the tax due is paid on time.

After three months, additional daily penalties of £10 per day, up to a maximum of £900 incur, while after six months, a further penalty of either 5% of the due tax or £300, depending on which is greater, is applied.

If the tax return is still not returned after a year, another 5% or £300 charge is added on.

There are also additional penalties for paying late, equating to 5% of the tax unpaid at 30 days, six months and 12 months, with interest also being charged on any late paid tax.

Pensions and savings expert at AJ Bell, Charlene Young, said: “The numbers show that the perfect storm of rising interest rates, reduced allowances and frozen tax thresholds in 2023/24 continued to whisk people into the tax return trap.

"HMRC estimates that 1.1 million people failed to file by the deadline risking £100 late filing penalties, a potential windfall for the tax man of £110m. Many people would have failed to realise they need to file an assessment at all and the £100 late fee applies even if there is no tax to pay.

"Along with the late penalty, daily interest will start to accrue based on an annual rate of 7.25% on any tax owed. Anything for 2023-24 still left unpaid by 1 March could suffer an extra 5% penalty charge. These percentage charges apply to unpaid tax due last year, not payments on account due for the coming year.

"If you don’t have an excuse to appeal a fine but still owe money, get in touch with HMRC as soon as you can as you might still be able to set up a payment plan to get back on track."

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