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Penalty saved!

25 September 2012 / Mark McLaughlin CTA (Fellow)
Issue: 4372 / Categories: Comment & Analysis , Admin
A look at the suspension and reduction of fines for tax return errors, by MARK McLAUGHLIN


  • The new penalty regime and factors for reductions.
  • The special circumstances in FA 2007 Sch 24 para 11.
  • Recent cases where reduced penalties have been applied.
  • Rights of appeal and HMRC’s obligations when considering penalties.
  • Suspension of penalties and future compliance.

When the penalty regime for errors in tax returns etc was introduced (in FA 2007 Sch 24) the perception among many tax professionals was that individual taxpayers would generally be faced with higher penalties than under previous law (TMA 1970 s 95) and HMRC practice (see Enquiry manual at EM6065).

For example in the case of an HMRC enquiry into a tax return resulting in the discovery of a negligent (now careless) error back in the days of the local inspector...

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