»Ê¹ÚÌåÓýapp

Please note: the Section 67 VATA 1994 penalty has been replaced by the Failure to Notify penalty introduced by Schedule 41 Finance Act 2008. »Ê¹ÚÌåÓýapp Failure to Notify penalty applies to obligations to notify the acquisition of a new means of transport on or after 01/04/2010. »Ê¹ÚÌåÓýapp penalty under Section 67 VATA 1994 continues to apply where the obligation to notify the acquisition of a new means of transport occurs before 01/04/2010.

Please see the Compliance Handbook CH70000 for more information about the Failure to Notify penalty.

»Ê¹ÚÌåÓýapp 4 basic steps are

• Establish liability. Where reasonable excuse exists there is no liability to a penalty.
• Quantify the liability.

• Raise a penalty assessment. We have discretion whether or not to assess any penalty, interest or surcharge. In exercising discretion, we must

  • Maintain equity in the application of civil penalties.
  • Take full account of the circumstances of the particular case.
• Notify a penalty assessment.

»Ê¹ÚÌåÓýapp objective of civil penalties is to encourage trader compliance.

Level of penalty

For failure to notify/late notification

• notification up to 3 months late - 5% of tax due
• notification exceeding 3 months but not exceeding 6 months late - 10% of tax due
• notification exceeding 6 months late - 15% of tax due.

For failure to pay

• payment up to 3 months late - 5% of tax due
• payment exceeding 3 months but not exceeding 6 months late - 10% of tax due
• payment exceeding 6 months late - 15% of tax due.

A person can incur two penalties

• the first for late notification
• the second for late payment.

Note: A penalty of £50 applies where the penalty is calculated at less than £50 or where there is no relevant VAT.