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HMRC internal manual

Compliance Handbook

From
HM Revenue & Customs
Updated
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Penalties for VAT and Excise Wrongdoing: In what circumstances is a penalty payable: What periods are penalties charged for

A penalty for a VAT and Excise wrongdoing listed in CH91200 is charged for a tax period or a penalty period.

Person registered with HMRC

If the person liable to the penalty is registered with HMRC for the tax or duty concerned, the tax or duty is assessed on the basis of tax periods. The penalty is also based on tax periods. A tax period is an accounting period.

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Person not registered with HMRC

If a person is not registered with HMRC for the tax or duty concerned and

  • makes an unauthorised issue of an invoice showing or including VAT, the penalty period will be the date of the invoice. If there is more than one invoice, the penalty period starts with the date of the first invoice and ends with the date of the last invoice
  • misuses a product in a way that attracts a higher amount of excise duty, the penalty period will be the date of the act which enabled the assessment to be made. If there is more than one date, the penalty period starts on the date of the first and ends on the last act of misuse
  • supplies a product knowing that it will be used for a purpose that attracts a higher rate of duty, the penalty period will be the date of the supply which enabled the assessment to be made. If there is more than one date, the penalty period starts on the date of the first and ends on the date of the last supply
  • handles goods subject to unpaid excise duty, the penalty period will be the date on which the goods were handled. If there is more than one date, the penalty period starts on the first and ends on the last date the goods were handled.