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HMRC internal manual

Company Taxation Manual

From
HM Revenue & Customs
Updated
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CTSA: penalties for late returns: time limits

TMA70/S103

You can determine a flat-rate penalty at any time within six years after the date the penalty was incurred or began to be incurred.

You can determine a tax-related penalty at any time within the later of:

  • six years after the date the penalty was incurred - example 1,
  • three years after the final determination of the tax on which the penalty is calculated – example 2.

Example 1

  • Company A is required to deliver a return for the accounting period ended 31 December 1999 by the filing date, 31 December 2000.
  • It fails to deliver its return until 1 February 2001.
  • It incurs a flat-rate penalty on 1 January 2001.

You can determine it at any time up and including 1 January 2007.

Example 2

  • Company B is required to deliver a return for the accounting period ended 31 December 1999 by the filing date, 31 December 2000.
  • It fails to deliver its return until 1 August 2001 and makes no payment before that date.
  • The SA for the accounting period ended 31 December 1999 is finally determined on 1 January 2005 at £10,000.

You can determine a tax-related penalty at any time up to 1 January 2008, three years after the relevant amount of tax is finally determined. This is later than 1 July 2007, six years after the date when the company incurred the penalty.