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HMRC internal manual

Inheritance Tax Manual

HM Revenue & Customs
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Penalties: types of penalty

Penalties can be sought for various acts or omissions that might prevent the collection of tax properly due.

In general penalties arise because

  • an account is delivered late (IHTM36021), IHTA84/S245
  • there is a failure to deliver an account ((IHTM36081),IHTA84/S245
  • there is a failure to meet the requirements of IHTA84/S218A where an instrument of variation made on or after 1 August 2002 results in additional tax (IHTM36091), IHTA84/S245A (1A)
  • an account, information or document is incorrect (IHTM36102), IHTA84/S247 or
  • there is a failure to correct an earlier error within a reasonable timescale (IHTM36102), IHTA84/S248
  • there is a failure to comply with a IHTA84/S219A notice for information (IHTM32221), IHTA84/S245A (3). We may also seek penalties where there is a failure

  • to comply with a IHTA84/S219 information notice (IHTM32231), IHTA84/S245A (2)
  • to make a return under IHTA84/S.218 of names and addresses of both the settlor and trustees where a settlement is domiciled in the UK and the trustees are not resident in the UK, IHTA/S245A(1)The situations that give rise to the latter group of penalties are rarely seen and they are dealt with by Litigation.