CH123500 - Offshore matters: requirement to correct certain offshore tax non-compliance: failure to correct - penalty assessments - procedures

You must check the date from which these rules apply for the tax or duty you are dealing with. See CH123050 for full details.

Once we have established that a person is liable to a penalty we will normally assess the penalty. Alternatively in direct tax cases, the person can make us an offer to settle the tax, interest and penalties by contract settlement, see EM6000.

The penalty assessment is enforceable in the same way as an assessment ‘to tax’. This means that the rules that apply to the tax or duty to which that penalty relates also apply to the penalty assessment. So for Inheritance Tax, for example, the penalty assessment is enforceable in the same way as a notice of determination.

Procedure for assessing the penalty

When you assess a penalty or penalties you must

  • assess the penalty
  • notify the person, and
  • state in the notice
  • the uncorrected relevant offshore tax non-compliance to which the penalty relates, and
  • the tax period to which the offshore tax non-compliance relates.

A penalty must be paid before the end of the period of 30 days beginning with the day on which notification of the penalty is issued.

A person may appeal against

  • HMRC’s decision that a penalty is payable by that person, or
  • the amount of the penalty.

Section 67 and Schedule 18 Finance Act (No 2) 2017