HMRC is looking into your tax
The penalty depends on why the tax was wrong and who spoke first. Telling HMRC before they ask, and helping fully, keeps it at the bottom of the range.
Your answer
Enter roughly how much extra tax a year is involved.
About this calculator
For anyone who has had a letter from HMRC about a compliance check, or who has found a mistake and is thinking of telling HMRC. It gives a rough cost: the extra tax for the years HMRC can reach, interest on it, and the range the penalty can fall in.
It's an estimate, not a prediction. HMRC decides the behaviour and the penalty on the facts. It covers income tax, Capital Gains Tax and Corporation Tax in the UK; it doesn't cover offshore matters, which can go back further and carry higher penalties.
What happens to your answers
We don’t keep them. Your answers go to our server to do the sums and aren’t stored or logged. If you copy a link to your answers, they’re in the link itself, so only share it with people you trust.
How it’s worked out
HMRC can usually go back 4 years from the end of the tax year. If the error was careless it can go back 6 years, and if it was deliberate, 20. We count the years you give, up to that limit, at the same tax each year.
Interest runs from when each year's tax was due, at HMRC's late payment rate. We use today's rate for every year, so the oldest year carries the most interest.
The penalty is a share of the extra tax: careless 0% to 30%, deliberate 20% to 70%, deliberate and hidden 30% to 100%. The bottom of each range is higher (15%, 35% or 50%) if HMRC asked first. Full help puts you at the bottom; partial help, we assume, halfway.
Worked example
HMRC's check could cost about £19,575: £15,000 tax, £2,325 interest and a £2,250 penalty.
a letter about one return · careless · HMRC asked first · full help · £5,000 a year for 3 years · income tax, CGT or corporation tax, UK only
| HMRC can go back 6 years for a careless error: we count the 3 you gave | 3 years |
|---|---|
| Extra tax: £5,000 a year × 3 years | £15,000 |
| Interest, roughly: £5,000 × 7.8% × (1 + … + 3) years outstanding (today's rate for every year) | + £2,325 |
| Penalty range for careless when HMRC found it or asked first (prompted): 15% to 30% of the extra tax | £2,250 to £4,500 |
| Full help: all the reduction, so the minimum: 30% − (30% − 15%) × 100% = 15% | + £2,250 |
| Our estimate of the cost | £19,575 |
Worked out using HMRC's published rates for the 2026/27 tax year (6 April 2026 to 5 April 2027), on a yearly basis.
Questions people ask
Does it help to tell HMRC myself?
Yes. If you tell HMRC before you have reason to think they've found it, the lowest possible penalty drops: for a careless error it can be nothing at all. Use the Digital Disclosure Service, the Let Property Campaign for letting income, or the Worldwide Disclosure Facility for anything from abroad. You then have 90 days to send the details and pay.
What if I took care and still got it wrong?
There's no penalty if you took reasonable care. You still pay the tax and the interest.
Can I appeal the penalty?
Yes, within 30 days of the penalty notice. You can disagree with the behaviour HMRC has decided on, or with how much reduction it has given you for helping.
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