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HMRC internal manual

Compliance Handbook

HM Revenue & Customs
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Penalties for Inaccuracies: Other Penalty Issues: Agency - Agent acting - Inaccuracy attributable to another person

You must check the date from which these rules apply for the tax or duty you are dealing with. See CH81011 for full details.

We may charge another person (T) a penalty where

  • a person (P) gives us a return that contains an inaccuracy, and
  • the inaccuracy is attributable to another person (T) deliberately supplying false information or deliberately withholding information, and
  • T intends P’s return to contain an inaccuracy that leads to

    • an understatement of tax liability,
    • a false or inflated statement of a loss, or
    • a false or inflated claim to repayment of tax.

It is extremely unlikely that a tax adviser would be liable to this kind of penalty.

Normally a tax adviser receives information from a person and then gives advice based on that information. It would be very unusual for a tax adviser, in that capacity, to give information, see CH81166, to a person in a manner that would satisfy the conditions above.

You will need to examine the facts very carefully if you consider that this penalty may be chargeable and T is a tax adviser.

Where you suspect that a tax agent has engaged in dishonest conduct, see technical guidance starting at CH180000 and operational guidance starting at CH880000. Where you identify other types of poor agent behaviour, see CH800000.