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HMRC internal manual

Civil evasion penalties for Customs, Excise and VAT

Civil evasion penalties for Customs, Excise and VAT: when civil penalties are charged

Civil evasion penalties are charged when customs duty, excise duty or VAT are evaded and HMRC have decided that they are a more cost-effective course of action than criminal investigation with a view to prosecution.

In every case, the decision on whether to criminally investigate or charge civil penalties is made using the Evasion Referral Process, see CH290000

Civil evasion penalties cannot be charged if the case has been criminally prosecuted or a compound penalty has been paid instead of criminal proceedings. However, late payment penalties and interest may still apply in these circumstances.

In some cases, civil evasion penalties can be considered after other civil penalties have been charged, for example, VAT misdeclaration penalty. The other penalties may be withdrawn and replaced by civil evasion penalties. However, you must ensure that the person’s rights under the Human Rights Act are not compromised. Further information on such VAT cases is at CEP3150