How much is the ATO late lodgement penalty?
Short answer
For an individual or small business, the ATO failure to lodge (FTL) penalty is $364 for every 28 days, or part of 28 days, that a return or statement is late, capped at 5 units or $1,820 per document for lodgements due from 1 July 2026. Medium entities pay double and large entities five times that. The penalty can be remitted, and our penalty remission guide explains how.
How the penalty is worked out
The penalty is counted in penalty units, currently $364 each. One unit is charged for each 28 day block the document is overdue, including a part block, up to a maximum of five. For a small entity that gives:
| Days late | Units | Small entity | Medium (x2) | Large (x5) |
|---|---|---|---|---|
| 1 to 28 | 1 | $364 | $728 | $1,820 |
| 29 to 56 | 2 | $728 | $1,456 | $3,640 |
| 57 to 84 | 3 | $1,092 | $2,184 | $5,460 |
| 85 to 112 | 4 | $1,456 | $2,912 | $7,280 |
| 113 or more | 5 | $1,820 | $3,640 | $9,100 |
Small means an individual or an entity with turnover under $1 million. Medium is roughly $1 million to $20 million in turnover or a medium PAYG withholder. Large is $20 million and above. Significant global entities are multiplied by 500. Lodgements that fell due before 1 July 2026 use the older $330 unit.
The penalty is per document
The cap of $1,820 applies to each return or statement, not to you as a taxpayer. That is the trap. Someone who has not lodged for a year could be looking at four quarterly BAS plus an income tax return, each at the maximum: five documents at $1,820 is $9,100 before any tax or interest. The penalty is not tax deductible, and general interest charge runs separately on any tax that was unpaid from the original due date.
The penalty is also completely separate from whether you owed anything. A late BAS with $200 of GST on it and a late BAS with $20,000 on it attract the same failure to lodge penalty.
Hit with late lodgement penalties?
Most penalties can be challenged. Find out whether yours can.
When the ATO does not apply it
The ATO does not penalise every late lodgement. Its published practice is to warn first, usually by phone or letter, and to skip the penalty where a late tax return results in a refund or a nil result. An isolated late lodgement after years of clean history is often not penalised or is remitted on request. If you use a registered agent and gave them everything on time, safe harbour means the penalty should not apply to you at all.
If a penalty has landed, the first step is to lodge anything still outstanding. The ATO will not consider remission while documents are missing. Then ask, in writing for anything more than a single unit, explaining what stopped you lodging on time. The reasons that work are set out in what reasons the ATO accepts.
What to do next
- Lodge everything that is outstanding, even if you cannot pay, because the penalty keeps growing every 28 days.
- Check the penalty notice to confirm the units and the entity size used are correct.
- Request remission in writing with the reason for the delay and any evidence.
Related questions
Does the late lodgement penalty apply if I have a tax agent?
Your agent's lodgement program usually gives you later due dates, so the clock starts later. If you still lodge late but you gave the agent everything they needed in time, safe harbour applies and the penalty should not be imposed on you. If the delay was your agent's fault, say so in the remission request.
Can the ATO penalise me for not lodging at all?
Yes. If you do not lodge, the ATO can issue a default assessment based on its own estimate of your income, add the failure to lodge penalty and a further administrative penalty, and charge interest from the original due date. Lodging late is always cheaper than not lodging.
Hit with late lodgement penalties?
Most penalties can be challenged. Find out whether yours can.
Get help nowMore questions: 15 ATO interest and penalties questions answered · Full guide: GIC remission