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Please note: VAT Misdeclaration Penalty has been replaced by the Schedule 24 inaccuracy penalty for all accounting periods where the return period commences on or after 01/04/2008 and the due date is on or after 01/04/2009. Misdeclaration penalty will still apply where the due date is before 01/04/2009.

Please see the Compliance Handbook CH80000 Penalties for Inaccuracies for further details.

»Ê¹ÚÌåÓýapp Penalty Liability Notice (PLN) Form VAT 670

A PLN (Form VAT 670) is a computer generated letter which informs traders they have made a material error and that future errors may lead to a penalty being imposed.

It is designed to be an early warning which provides an opportunity for traders to avoid penalty if they make a voluntary disclosure. »Ê¹ÚÌåÓýapp PLN is intended to assist traders and does not in itself carry any implication that the trader is persistently in error.

»Ê¹ÚÌåÓýapp mainframe will issue the PLN direct to the trader and a second copy will be sent to the local office for retention in the trader’s folder.

Issuing a PLN

A PLN will be issued if both of the following conditions are met

• errors on a return have breached one or both of the objective tests for MP(R), and
• the period which breached the objective tests is within 5 VAT periods of the processing of the VAT 641, 642, 643 or 644. »Ê¹ÚÌåÓýapp 5 VAT period span includes the current VAT accounting period for which no return will have been received.