Compliance checks and the ‘old’ penalty regime
A new factsheet entitled ‘Compliance checks – Self Assessment and old penalty rules’ has been published by HMRC. The factsheet explains the rules that HMRC use in determining if the old penalty rules apply as part of a self-assessment compliance check.
Taxpayers may be subject to a penalty if errors are found on their self-assessment returns such as tax which has been under-declared or over-claimed.
Where HMRC find errors which relate to the period before the new penalty rules started, the old penalty rules will continue to apply. The factsheet also explains how the ‘old’ penalties are calculated, how the penalties can be reduced and covers the taxpayers rights’ where they disagree with a decision of HMRC.
The new penalty regime applies to:
- Errors in tax returns that cover a period commencing on or after 1 April 2008 if the tax return was due to be sent to HMRC on or after 1 April 2009.
- Failures to notify liability to tax that happened after 1 April 2010.