What is the penalty under section 118 of the Tax Collection and Management (Wales) Act 2016 for failing to file a tax return on time?

Under section 118, a person who fails to submit a required Welsh devolved tax return by the filing date is automatically liable to a fixed penalty of £100. This amount does not vary based on the size of the tax liability or the length of the delay. It is simply triggered by missing the deadline.

Does the £100 penalty apply to all Welsh devolved tax returns filed late?

The £100 fixed penalty generally applies to all Welsh devolved tax returns filed late, including land transaction tax and landfill disposals tax. However, an exception exists for repeated failures to file landfill disposals tax returns, which are subject to an alternative escalating penalty regime under section 118A.

Is the section 118 penalty the only consequence for failing to file a Welsh tax return?

No. The £100 fixed penalty under section 118 is only the initial penalty. If the tax return remains outstanding beyond the filing date, further penalties can accrue for continued failure to file. The longer the return is delayed, the greater the total penalties a person may face under the Act.

What happens if a person repeatedly fails to file landfill disposals tax returns in Wales?

Where a person repeatedly fails to file landfill disposals tax returns, the standard £100 penalty under section 118 may be replaced by an alternative penalty regime under section 118A. This separate provision introduces an escalating penalty structure designed to address persistent non-compliance with landfill disposals tax filing obligations.

Tax Collection and Management (Wales) Act 2016 section 118

Penalty for failure to make tax return on or before filing date

Section 118 establishes the initial fixed penalty that applies when a person fails to submit a required tax return by its filing date.

A person required to make a tax return who misses the filing date is liable to a flat penalty of £100.
The penalty applies automatically once the filing date has passed without a return being submitted.
An exception exists for certain repeated failures to file landfill disposals tax returns, which are dealt with under a separate provision (section 118A).
The £100 penalty is the starting point; further penalties may apply for continued failure to file.

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