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HMRC internal manual

Compliance Handbook

Penalties for failure to notify: other penalty issues: company and company officer penalties: officer of a company liable to a penalty

An officer of a company may be personally liable to pay all or part of the company penalty where

  • a company is liable to a penalty for a deliberate failure to notify, and 
  • the deliberate failure is attributable to the actions of an officer or officers of the company, see CH75540.

Before you can consider charging a company officer penalty both of the two conditions above and one of the two circumstances below must also apply

  • the officer gained or attempted to gain personally from the failure to notify, see CH75590, or 
  • the company is insolvent or likely to become insolvent, see CH75610.

Please note that an officer’s liability to pay a penalty also applies to inaccuracy penalties, see CH84610, and wrongdoing penalties, see CH98550.

These company officers are known in this guidance as ‘liable officers’.

In the limited circumstances where it applies the power gives us the right to recover all or part of the penalty from the liable officer. It is important to note however that the penalty is always assessed on the company because it is the failure to meet the relevant obligation. This means that we do not assess the liable officers for the penalty, but we must send each liable officer a personal liability notice, see CH406300. Personal liability notices are however treated procedurally as if they are penalty notices.

Where there is more than one failure, each deliberate failure must be considered separately for the purpose of establishing whether it should be attributed to an officer or officers.

You cannot recover more than 100 per cent of the penalty from the company and its liable officers. See CH406200 for guidance about how to apportion the penalty between the liable officers.

CH71300 lists the relevant obligations.

FA08/SCH41/PARA22 (1) & (2)