Guide on Tax Penalties for Late Filing or Payment in Wales

WRA penalties for late filing or late payment of Land Transaction Tax

The Welsh Revenue Authority can charge separate penalties if a Land Transaction Tax return is filed late or the tax is paid late, and interest may also keep running. Late filing and late payment are different failures, so a taxpayer may face one, the other, or both depending on what happened and how long the delay lasted.

• Late filing penalties for LTT start with a £100 fixed penalty, then can rise after 6 months and again after 12 months to £300 or 5% of unpaid tax, whichever is higher.
• Late payment of LTT can trigger a 5% penalty on unpaid tax, with further 5% penalties if the tax is still unpaid within 6 months and within 12 months.
• Interest may be charged on unpaid amounts throughout the period of non-payment, and penalty notices normally have to be paid within 30 days unless appealed.
• If someone deliberately withholds information needed to assess the tax, the late filing penalty can be much higher, potentially up to 95% of the tax due.
• Whether a penalty is correct will often depend on the facts, including whether a return was required, the filing and payment dates, the amount unpaid, and whether there is a reasonable excuse or special circumstances.
• If you disagree with a penalty notice, you may be able to ask the WRA for a review or appeal to the tax tribunal.

Scroll down for the full analysis.

WRA penalties for filing or paying Land Transaction Tax late

This page explains the main penalties the Welsh Revenue Authority may charge if a Land Transaction Tax return is filed late or the tax is paid late. The official guidance also covers Landfill Disposals Tax, but the practical points below focus on LTT where relevant. The key point is that late filing and late payment are separate issues. A person can face penalties for one, the other, or both, and interest may continue to run as well.

What this rule is about

LTT is a self-assessed tax. That means the taxpayer is responsible for making sure a return is filed when required, that it is accurate, and that any tax due is paid on time. If those obligations are not met, the WRA may impose penalties.

The guidance is aimed at two common failures:

• filing a required return after the filing date
• paying tax after the relevant payment deadline

These rules matter because the financial consequences can build up quickly. A fixed penalty can be followed by further tax-geared penalties, and daily interest may still be charged while the amount remains unpaid.

What the official source says

The WRA says that if you receive a penalty notice, it will tell you what is owed, how to pay, and what to do if you disagree with the decision. Unless you appeal, the penalty must be paid within 30 days of receiving the notice. If it is not paid, daily interest will be charged.

For late filing of a required return, the main penalties summarised by the WRA are:

• up to 6 months late: a £100 fixed penalty
• 6 to 12 months late: an additional £300 or 5% of any unpaid tax, whichever is greater
• 12 months late or more: a further £300 or 5% of any unpaid tax, whichever is greater

The guidance adds that if a person fails to file a return and deliberately withholds information that would help assess the tax due, the penalty may be increased to £300 or to an amount not exceeding 95% of the tax due.

For late payment, the WRA states that a penalty may be charged if tax is not paid by the penalty date shown on the notice.

For LTT, the guidance says the penalty is 5% of the amount of unpaid tax.

It also says further late payment penalties may apply:

• within 6 months: an extra 5% of any unpaid tax
• within 12 months: another 5% of any unpaid tax

Interest continues to run during the period of non-payment.

The WRA also notes that where more than one penalty arises, it will consider the facts and, where a penalty is not fixed, will consider the combined amount to ensure the overall result is proportionate.

What this means in practice

In practice, there are three separate financial exposures:

• a late filing penalty
• a late payment penalty
• interest on unpaid amounts

They do not cancel each other out. Filing the return late can trigger filing penalties even if the tax is eventually paid. Paying late can trigger payment penalties even if the return was filed on time. If both happen, both sets of penalties may arise.

The fixed £100 late filing penalty is the first step. If the return remains outstanding for longer, the penalties can become more serious because they move from a fixed amount to an amount linked to unpaid tax, with minimum amounts built in.

For late payment of LTT, the guidance indicates a 5% penalty on unpaid tax, with further 5% charges if the amount remains unpaid for longer. This means the size of the penalty depends directly on how much tax is still outstanding at the relevant time.

The reference to deliberate withholding is important. It shows that the WRA treats ordinary lateness differently from behaviour that obstructs the assessment of tax. Where the failure to file is accompanied by deliberate non-disclosure, the penalty can be much higher.

How to analyse it

If you are trying to work out whether a penalty may apply, the sensible questions are:

• Was a return required?
• If so, what was the filing date?
• Was the return actually filed by that date?
• How long late was it?
• Was any LTT unpaid by the relevant payment date?
• How much tax remained unpaid at each penalty stage?
• Is there any suggestion that information was deliberately withheld?
• Has the WRA issued a notice, and if so when was it received?
• Is there a basis to challenge the penalty, for example a reasonable excuse or special circumstances?

It is also worth separating out the timing points carefully. The filing penalty timetable and the payment penalty timetable are not the same thing. A person may focus on filing the return and overlook that tax was paid late, or vice versa.

If a penalty notice has already been issued, the next practical questions are:

• Does the notice match what actually happened?
• Was the return in fact filed when the WRA says it was?
• Was the amount of unpaid tax calculated correctly?
• Should you ask the WRA for a review, or appeal to the tax tribunal?

Example

This is a simple illustration based on the WRA summary.

A buyer must file an LTT return and pay LTT. The return is not filed by the filing date, and the tax is also not paid on time.

First, the buyer may receive the £100 fixed late filing penalty.

If the return is still outstanding after 6 months, an additional penalty may arise of £300 or 5% of unpaid tax, whichever is greater.

Separately, because the LTT was paid late, a late payment penalty may also arise based on 5% of the unpaid tax, with further 5% penalties if the tax remains unpaid at later stages.

On top of that, interest may continue to accrue while the amount remains unpaid.

So the total cost is not just one penalty. It may be a combination of filing penalties, payment penalties, and interest.

Why this can be difficult in practice

The WRA page is only a summary. It does not set out every detail of how the penalty rules operate, and it points readers to technical guidance for fuller treatment.

That matters because penalty cases often turn on facts and timing. For example:

• whether a return was actually required
• the exact date from which lateness is measured
• how much tax was unpaid at a particular stage
• whether conduct was merely careless, simply late, or deliberate
• whether there is a reasonable excuse
• whether special circumstances justify reduction, suspension, or remission

The guidance also says that multiple penalties will be considered in light of proportionality where the penalty is not fixed. That is helpful, but it does not create a simple formula. It means the overall position may depend on the facts of the case and the WRA’s assessment.

Another practical difficulty is that taxpayers sometimes assume that paying the tax cures a late filing problem, or that filing the return cures a late payment problem. It does not. The two obligations are linked, but they are still separate.

Key takeaways

• For LTT, late filing and late payment are separate defaults and can produce separate penalties.
• A fixed late filing penalty can be followed by larger penalties if the return remains outstanding, and interest may continue to run.
• If you disagree with a penalty, the WRA guidance says you may ask for a review or appeal to the tax tribunal, particularly where there is a reasonable excuse or special circumstances.

This page was last updated on 24 March 2026

Useful article? You may find it helpful to read the original guidance here: Guide on Tax Penalties for Late Filing or Payment in Wales

View all WRA LTT Guidance Pages Here