Compliance Strategy: Voluntary Disclosure: Overview
A disclosure is a voluntary disclosure if, at the time the disclosure is made, the person making the disclosure
- has no reason to believe that we have discovered or are about to discover the inaccuracy or overclaim; and
- reports the change to the details or circumstances held by HMRC without any fear of early detection
Otherwise it is a prompted disclosure.
HMRC want to encourage voluntary disclosures.
If the customer voluntarily corrects their details and the change only affects the Current Year (CY), unless there is already an examination for that year, the change can be processed by the Tax Credit Office (TCO) or Helpline and penalties are not considered.
However once a Tax Credit claim has been finalised it can only be changed under the strict rules provided for by the law. Two of those rules are prescribed at Sections 19 and Sections 20 (S19 and S20) of the Tax Credit Act (TCA).
When the TCO or Helpline identify a change of circumstance that will affect a finalised year, which can only be corrected using S19 or S20, the case is referred to a special team. The special teams are based within Claimant Compliance and are known as the S19Lite/S20Lite teams.
Processes known as S19Lite and S20Lite process have been specifically designed, for use by those teams, to deal with voluntary disclosures made after the claim has been finalised.
The S19Lite and S20Lite processes must only be followed by the S19Lite or S20Lite teams, see CCM2220.