Attended a webinar today with Chris Jennings of HMRC to learn more about the overhaul of VAT penalties.
From the 1st of April 2022, late submissions will result in the taxpayer receiving 1 point. At a certain threshold of points, they will be charged £200 for late submissions.
For late payments, the taxpayer will be charged a percentage of the tax due. This charge will be 2% after 15 days unpaid, 4% after 30 days. After 31 days the taxpayer will be charged daily.
This system seems fairer than the current default surcharge mechanism.