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HMRC internal manual

Debt Management and Banking Manual

From
HM Revenue & Customs
Updated
, see all updates

Debt and return pursuit: miscellaneous: Anti Avoidance Group (AAG) penalties

Background

From 1 August 2004 any provider of a tax avoidance scheme is required to register the existence of such schemes by specific deadlines.

Registration is with the Anti Avoidance Group (AAG), a part of Business Tax.

Failure to register will result in initial penalties of up to £5,000 with further penalties of up to £600 a day for continuing failure.

AAG are further authorised to impose additional penalties for failure to notify the Board of reference numbers as follows

  • £100 for a first offence
  • £500 for a second offence within 36 months
  • £1,000 for the third and subsequent offences within 36 months.

Action by AAG

AIU will enter the charge on to SAFE.

Due date

305 penalties are due 30 days from the issue of the penalty notice.

394 penalty determinations are due 30 days from the issue of the determination notice

Stand-over and amendment

Stand-overs and amendments will be entered directly on to SAFE.

SAFE Action

Application for payment

SAFE will automatically issue applications for payment applicable to the charge type and pass the charge for local recovery action at the appropriate time if the debt remains unpaid.

Referral for Local Action

When local action is required an entry will appear on the SAFE Local Action worklist if the debt remains unpaid.

Remissions

The normal remission rules apply as in DMBM725000.

Debt technical office action

The case will appear on the SAFE Local Action worklist when local office action is required.

In England and Wales

Penalties issued by the AAG are recoverable as if they are tax charged in an assessment under S100A (3) TMA 1970.

  • 394-type penalties are determined under Section 100 of the Taxes Management Act 1970, as amended by Section 315 of the Finance Act 2004.
  • 305-type penalties are determined under Section 100C of the Taxes Management Act 1970, as amended by Section 315 of the Finance Act 2004.

Payment may be enforced through any appropriate means including county court proceedings.

These penalties are not suitable for the County Court Bulk Centre.

In Scotland

If you receive any such penalties, refer to Debt Management Group Scotland for instructions.

In Northern Ireland

If you receive such penalties, contact (This content has been withheld because of exemptions in the Freedom of Information Act 2000) for instructions.

Interest and repayment supplement

Interest is chargeable from the due date to the date of payment under Section 103A Taxes Management Act 1970. SAFE will automatically calculate interest and raise any late payment interest charge. If you need to clerically calculate interest, use IRIS function SAIN. Repayment supplement is due under S824 (1)(d) ICTA 1988. IRIS function SARI may be used to calculate repayment supplement.