Soft Drinks Industry Levy penalties
Find out about penalties for registering, submitting returns, inaccuracies and paying the levy late, and how to appeal a penalty.
If you register late
If you register late, HMRC may charge you a penalty.
The penalty will be calculated as a percentage of the ‘potential lost revenue’. This is a percentage of the amount of the levy which is unpaid because of the failure to notify. When working out the amount of the penalty we will also consider what caused the failure and whether you have disclosed the failure before we discovered it.
You will not be charged a penalty If the failure was non-deliberate and you have a reasonable excuse.
You can find more information about failure to notify penalties in this factsheet Compliance checks series – CC/FS11.
In certain circumstances, if you do not register when you should, there is evidence of serious non-compliance and you do not have a reasonable excuse, you’ll be committing an offence. If convicted, you could face a prison term of no more than 12 months (6 months in Northern Ireland) and whichever is greater of:
- a fine not exceeding £20,000
- 3 times the amount of potential levy lost
If you submit a return late
You must submit your Soft Drinks Industry Levy return and pay the levy within 30 days of the end of the reporting period. The reporting periods are June, September, December and March.
You’ll be charged penalties if you do not.
You’ll be charged a £100 penalty the first time you submit a return late. If you submit a return late, submit 4 returns on time and then submit the next return late, you’ll also be charged a £100 penalty.
If you submit a:
- second late return within 12 months of the previous late return you’ll be charged a penalty of £200
- third late return within 12 months of the previous late return you’ll be charged a penalty of £300
- fourth late return within 12 months of the previous late return you’ll be charged a penalty of £400
If your last late filing penalty was £400, and you submit a late return again within the next 12 months of your most recent late return, you‘ll be charged a £400 penalty.
If you have not submitted a return after 6 months
If you do not submit a return within 6 months of it being due, you’ll be charged a further penalty. The penalty will be the greater of either:
- 5% of what you owed in that return period
- £300
You’ll be charged an additional penalty which, will be the greater of either 5% of what you owed in that return period or £300, if you have not submitted the return within 12 months of it being due.
If we think you have deliberately withheld information that would have helped us work out how much you owe, we may increase this penalty to up to 100% of what you owe.
If you pay late
If you do not pay the full amount of the levy due within 30 days of the end of each reporting period you’ll be charged a penalty of 5% of the outstanding amount.
If you have not paid the levy after 5 months from the day it was due, you’ll be charged a penalty of 5% of the outstanding amount.
If the levy due is still outstanding after 11 months from the day it was due, you’ll be charged a further 5% of the outstanding amount.
If there is an inaccuracy in your return or document
You may be charged a penalty if you give HMRC a return or other document that contains an inaccuracy and the inaccuracy:
- results in tax being unpaid, understated or over-claimed
- was careless, deliberate or deliberate and concealed
The penalty will be calculated on as a percentage of the ‘potential lost revenue’. This is the additional amount of levy that is due as a result of correcting the inaccuracy. When working out the amount of the penalty we will also consider what caused the inaccuracy and whether you have disclosed the inaccuracy before we discovered it.
You will not be charged a penalty if you took reasonable care.
You can find more information about inaccuracy penalties in factsheet Compliance checks for penalties of inaccuracies in returns or documents (CC/FS7a).
How to appeal a penalty
You can appeal against a penalty if you do not agree with it.
You may not have to pay some or all of a penalty if we agree you had a reasonable excuse.
Last updated 13 December 2021 + show all updates
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Information has been added about penalties for inaccuracies in a return.
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Information about the penalties you may have to pay for registering for the levy late has been added.
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First published.