Penalties for inaccuracies: other penalty issues: company and company officer penalties: personal gain
You must check the date from which these rules apply for the tax or duty you are dealing with. See CH81011 for full details.
Once you have attributed the deliberate inaccuracy to one or more of the company officers you should consider whether any of these officers, by fact or implication, have gained or attempted to gain personally from the inaccuracy. It is sufficient to show that each officer has gained or attempted to gain. It will not however always be possible to establish the full extent to which each officer has gained or attempted to gain.
- the officer may accept that there was an actual or attempted personal gain from a deliberate inaccuracy that can be attributed to them, or
- it may be clear from business records or the officer’s lifestyle that they gained or attempted to gain personally from the results of the deliberate inaccuracy.
The recorded payment of normal salary, wages or dividends should not normally be regarded as the company officer gaining personally from the deliberate inaccuracy unless the inaccuracy was an omission to make appropriate employer deductions from the company officer’s pay.
If at the time you are issuing the penalty assessment to the company you decide that there is no personal gain and that therefore the penalty is not to be apportioned to any of the company officers, you cannot laterpursue any of the company officers for payment of the penalty even if the circumstances subsequently change. For example, if there is no personal gain and you do not issue a notice of liability to the officers, you cannot later apportion liability to the officers if the company goes into liquidation.
This also means that you cannot change the proportion of the company’s penalty notified to any of the company officers, if the circumstances subsequently change.