Getting records on time depends on three things: written terms that say what the client must send and by when, an internal calendar that sets the firm’s own earlier deadlines, and a documented chasing sequence that escalates. Penalties for late filing fall on the client, not the accountant, so the firm’s job is to make the deadlines and consequences clear early and keep evidence that it did.
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Who bears the cost when records arrive late?
The client, in the first instance. A late Self Assessment return brings an initial £100 penalty, then £10 a day after 3 months up to £900, then the greater of 5% of the tax due or £300 after 6 months and again after 12 months, according to GOV.UK. Every partner is charged if a partnership return is late. For a private company, Companies House charges £150 for accounts up to one month late, rising to £1,500 for more than six months, and doubles the penalty if accounts are late two years in a row. Companies House says an appeal may not succeed if it was the accountant’s fault.
The firm bears a different cost: compressed workloads, written off time and, if it resigns at the last minute, a possible complaint. ICAEW’s fees and charge out rates resource advises against starting a job before all the information is in, because each time a file is picked up and put down again costs time. The Self Assessment deadlines and penalties and Companies House accounts penalties pages give the full penalty rules.
What should the engagement letter say about information?
ICAEW’s helpsheet on resigning close to a tax filing deadline lists, as the first piece of supporting evidence a firm should have, an initial client acceptance that sets out the expectations of both parties on timeframes and the specific deadlines by which information must be provided. It should explain the consequences of missing them, including additional fees, the penalties for late submission, and the possibility that the firm will resign and in what circumstances.
In practice that means the engagement letter or its schedules should include:
- a list of the records the client must provide for each service
- a date for each, set well before the statutory deadline
- what happens if the date is missed: a later slot in the work schedule, an extra charge for rushed work, or filing on estimates
- a statement that penalties caused by late information are the client’s responsibility
If the firm plans to charge more for late or incomplete records, the basis needs to be in writing at the outset. ICAEW’s fee information helpsheet says a firm setting a fixed fee must be clear about the extent of work covered and make clear when an additional fee is for work outside it.
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How should a practice set its internal deadlines?
Work back from the statutory dates. The main ones for a typical client bank are:
| Obligation | Statutory deadline | Source rule |
|---|---|---|
| Self Assessment online return and balancing payment | 31 January after the tax year | GOV.UK Self Assessment deadlines |
| Self Assessment paper return | 31 October after the tax year | GOV.UK Self Assessment deadlines |
| Private company accounts to Companies House | 9 months after the accounting reference date | Companies Act 2006, section 442 |
| Company Tax Return | 12 months after the end of the accounting period | GOV.UK Company Tax Returns |
| Making Tax Digital for Income Tax quarterly updates | 7 August, 7 November, 7 February and 7 May | GOV.UK quarterly updates guidance |
A common approach is to ask for year end records within a set number of weeks of the year end, and to treat any client whose records have not arrived three months before the statutory deadline as at risk. The UK tax deadlines calendar lists the wider set of dates.
How does Making Tax Digital change the cycle?
Sole traders and landlords whose qualifying income for 2024 to 2025 was over £50,000 should have started using Making Tax Digital for Income Tax from 6 April 2026, according to HMRC. Quarterly updates are due by 7 August, 7 November, 7 February and 7 May, and HMRC says an update must still be sent even if there was no income or expense in the period. For 2026 to 2027 HMRC will not apply penalty points for late quarterly updates, but all updates must be sent before the tax return can be submitted. After that year a late update earns a point, and 4 points bring a £200 penalty.
For records collection, that turns one annual chase into four. Firms that wait until January for a year of data will find the quarterly updates still outstanding. The practical response is to move clients onto bank feeds and receipt capture in their software, so the firm reviews data that is already there rather than requesting it. More detail is on the Making Tax Digital for Income Tax page.
What does an effective chasing sequence look like?
The resignation helpsheet describes the trail it expects: reminders before each deadline, chasers after each missed deadline saying the agreed timetable is now at risk, and, if it comes to it, a notice of resignation referring back to the original terms. Built into a practice system, that might be:
- a records request with a tailored checklist when the period ends
- an automated reminder two weeks before the client’s due date
- a personal email or call when the date passes, naming what is missing
- a formal letter at the at risk point, restating the statutory deadline and penalties
- a partner decision on next steps, recorded on the file
Every step should be logged. The helpsheet’s point is that the client should not be able to show they were unduly disadvantaged, and the record is what demonstrates that.
What can the firm do when a client is still late?
- Consider provisional figures. Where some figures genuinely cannot be finalised in time, the estimated figures page explains when HMRC accepts them and what must follow.
- Protect the payment position. Late filing penalties and late payment penalties are separate. Telling the client to pay an estimate by 31 January limits the late payment penalties of 5% at 30 days, 6 months and 12 months.
- File late and appeal only where justified. A penalty appeal needs a reasonable excuse; the reasonable excuse page explains what HMRC accepts.
- Resign. The resignation helpsheet says that before resigning close to a deadline, a firm should consider the fundamental principles and not prejudicing the client’s interests. If it does resign, it should give the reason, set out upcoming filing dates and penalties, suggest ways to limit the damage and cancel its HMRC agent authorisation, telling the client it has done so. That process is covered in disengagement letters.
How might this work for one client?
Illustration only. A landlord’s 2025 to 2026 records were due to the firm by 31 July 2026 under her engagement letter. Nothing has arrived by 31 August, so she gets a chaser listing the rent statements and mortgage interest figures needed. On 31 October, the firm’s at risk date, a formal letter explains the 31 January 2027 deadline, the £100 initial penalty and the daily penalties after three months, and states that information received after 30 November will be charged at the rush rate set out in her letter. She sends the records on 12 December. The firm completes the return, adds the surcharge with an explanation, and files in January. Every step is on the file.
What are the common mistakes?
- Engagement letters that say nothing about information deadlines or late surcharges.
- One generic checklist for every client, so the request misses what that client actually has.
- Chasing by phone with no written record.
- Starting work on half the records and stopping, which wastes time twice.
- Waiting until January to find out who has not sent anything.
- Resigning in the final weeks without the earlier warnings.
Solar Protect runs fee protection schemes for accountancy and bookkeeping practices. See how our accountant schemes work or read fee protection schemes for accountants.
Related Accountapedia entries
- Workflow and deadline management for practices
- MTD late submission penalty points for agent clients
- Pricing MTD Income Tax quarterly work
- Managing the January Self Assessment peak
- Updating engagement letters for MTD Income Tax
- MTD late submission penalty points
Related cover: Professional indemnity insurance for accountants and What professional indemnity insurance covers. For the whole practice, see insurance for accountants and fee protection schemes for your clients.
Sources
- GOV.UK: Penalties
- GOV.UK: Penalties for late filing
- ICAEW: Fees and charge out rates
- ICAEW: Resigning close to tax filing deadline
- ICAEW: Fee information
- GOV.UK: Deadlines
- legislation.gov.uk: Act 2006 c. 46, section 442
- GOV.UK: Company tax returns
- GOV.UK: Send quarterly updates
- GOV.UK: Check if youre eligible for making tax digital for income tax
Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.