HMRC internal manual

Debt Management and Banking Manual

DMBM552080 - Corporation tax: Pursuit of automatic penalties

You should check the other guidance available on GOV.UK from HMRC as Brexit updates to those pages are being prioritised before manuals.

The preferred method of enforcement action for small debts in

  • England and Wales is summary proceedings
  • Scotland is summary warrant.

Action on receipt of first penaltyWhen the first flat rate penalty (F1) is received, you should carry out a full pre-enforcement check to

  • establish the status of the company, for example, whether trading, ceased or dormant
  • check whether we have an effective business address and
  • decide on the appropriate action for the case, which could include

    • a request to the assessing / compliance office for the case to be cleansed (for example, closed or made dormant)

    • selecting the most appropriate enforcement path

    • (This content has been withheld because of exemptions in the Freedom of Information Act 2000) For cases that do not go through the automatic route or arrive via the DMTC but the IDMS10 has not been issued to the correct address then

  • carry out the pre enforcement check whilst the case is on the CT caseworker worklist if no action has been taken by the DMTC
  • issue the IDMS10 to the business address, or where that is not known or can not be established, to the registered office.Do not transfer work items on IDMS enforcement worklists back to CT caseworker worklists for the pre-enforcement checks to be done. Local arrangements should make sure that these are completed by the appropriate caseworker.

If enforcement proceedings are appropriate

  • B/F the case to a date (15 weeks) after the filing date to link with the second flat rate penalty (F2).On expiry of the B/F

  • carry out an RP check and
  • commence summary proceedings (or summary warrant in Scotland) for both F1 and F2 debts together ensuring 30 days has elapsed since the F2 was issued.If the combined F1 and F2 debt is below £100

  • contact the assessing / compliance office to clarify whether a Revenue Determination is appropriate and if so
  • B/F the item to link with the determination after the proposed date of issue.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

If the company’s debt is increased and an order has been obtained for the original debt, for example, a penalty, then the additional amount should be recovered separately by the most appropriate enforcement method.