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HMRC internal manual

Compliance Handbook

HM Revenue & Customs
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Charging penalties: changing the penalty after it’s been authorised

You may need to change your penalty decision or decisions after they have been authorised but before you have taken closure options on the Penalty Decisions and Actions Checklist (PDAC), for example if the person has provided information that changes the penalty position, or the person has not agreed to suspension conditions and so the penalty must now be charged. The authorising officer will need to unlock the PDAC by pressing the ‘revise’ PDAC button.

To withdraw a penalty you will need to

  • amend the PDAC, see CH407100
  • re-submit to the authorising officer for authorisation to withdraw the penalty
  • once your decision has been authorised, cancel the penalty case indicator in Caseflow
  • tell the person by letter that the penalty has been withdrawn.

To amend the penalty

  • recalculate the penalty in NPPS, see CH407500 and CH407835
  • amend the PDAC, see CH407100
  • in VAT cases, amend the potential lost revenue in the VAT Mainframe, see CH403354
  • re-apply for authorisation, CH407000, and
  • if a revised penalty is to be charged, send the person a new Penalty Explanation Letter, see CH408000.

If the person does not agree the suspension conditions, you will need to

  • remove any suspension indicator from NPPS
  • in VAT penalty cases, also complete a VAT643 to amend the suspension indicator on the VAT Mainframe, see CH403354
  • update the PDAC to explain why the penalty can’t be suspended and send it to the authorising officer, see CH407000, and
  • once authorisation is obtained, issue a penalty assessment via NPPS.

Updating the PDAC after finalisation

If you have finalised the PDAC following the closure actions and information is received that alters the original decisions, you must record those changes. The PDAC must always reflect the latest case position.

  • open the PDAC and visit the Reviews & Appeals tab
  • select to add a new record
  • select the inaccuracy or inaccuracies you wish to review
  • add information stating who conducted the review and the outcome.