CH155393 - Penalties for Failure to Pay on Time: Rules for specific taxes: Excise Duty – excise goods for use on a ship, aircraft or train as stores: Penalties: Failure to pay all or part of amounts due - default penalty
A person can incur a default penalty where they do not pay excise duty in respect of goods for use on a ship, aircraft or train as stores by the due date. The penalty is incurred on the penalty date.
Calculate the default penalty
To calculate the default penalty for duty unpaid at the penalty date, follow these steps,
- Take the number of failures in the penalty period. A failure is a failure to pay all of the duty by the due date.
- Use the number of failures to work out the number of defaults in the penalty period. A default is any failure to pay an amount of duty in full by the due date, except the first such failure.
- Use the table below to find the penalty rate for a failure, which depends on the number of previous defaults in that penalty period.
-
Apply the percentage from the
table to the amount of duty not paid by the due date, even if part or all of
these amounts have been paid in the meantime.
Table of default penalty rates
| Number of failures during the penalty period | Number of defaults during the penalty period | Default penalty rate for the accounting period |
|---|---|---|
| 1 | Nil | n/a |
| 2 | 1 | 2% |
| 3 | 2 | 3% |
| 4 (and subsequent) | 3 (and subsequent) | 4% |
The penalty period ends 12 months after the due date for the person's most recent failure. If the person fails to pay any amount of duty by the due date after the penalty period has ended, then a new penalty period starts and this is the first failure in the new penalty period, and does therefore does not attract a default penalty.
All failures, whether or not they attract a default penalty, where payment continues not to be made within 6 and 12 months after the due date attract one or two further penalties, see .
FA09/ SCH56/PARA3
FA14/SCH21