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Penalties in practice

13 January 2015 / Fiona Fernie
Issue: 4484 / Categories: Comment & Analysis , penalties , Admin , Compliance , Investigations

The inconsistencies of HMRC’s unified system of fines


  • Use published cases as well as experience to understand what is happening.
  • HMRC will only accept reliance on an adviser as a reasonable excuse in limited circumstances.
  • Unacceptable differences exist between the treatment of taxpayers undertaking broadly similar schemes.
  • The standard wording in penalty suspension letters is incorrect but hard to get changed.

When HMRC embarked on their programme to unify penalties across the whole tax system in 2007 the focus was on issues such as the mechanism for calculating the amount whether there was still room for negotiation and whether the new system would result in generally higher penalty levels.

The legislation is now operational across all the main taxes and has been for some time. It is therefore now possible to gauge how the new rules appear to...

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