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HMRC internal manual

Compliance Handbook

How to do a compliance check: types of compliance check: pre-return checks: returns more that 12 months late

A person will be liable to a penalty when they do not file their returns or other documents on time.

Detailed guidance about these penalties is at CH60000. The commencement date is set out at CH61120.

The penalties for failing to file on time currently only apply to filing obligations under

  • income tax and capital gains tax (excluding PAYE)
  • bank payroll tax
  • the Registered Pensions Scheme
  • the Construction Industry Scheme (CIS).

When a return that relates to one of the obligations listed above is more than 12 months late you may need to check whether the person has, in failing to file the return, deliberately withheld information that would allow us to assess their tax liability. You do not have to wait for the return to be filed before you start your check.

Your check may be part of an ongoing compliance check where, for example, there is a missing return and you have evidence that information has been withheld.

Alternatively, outside of a check into other returns, you may have evidence that a person has, in failing to file their return for more than 12 months, deliberately withheld information from us.

In either case you can use your powers under FA08/Sch36 to

  • find out more about the information that was withheld
  • find out why information was withheld
  • gather information to assess the person’s tax liability
  • gather information to charge the penalty.

If the withholding of information relates to CIS, see CH21075.

Where a self assessment return is filed more than 12 months late and you need to investigate the withholding of information, see CH23540.