IEIM405132 - Penalty Reductions for each Account Holder or Controlling Person Penalties
Penalty Reductions for each Account Holder or Controlling Person Penalties
Mitigating factors may apply to penalties in relation to each Account Holder or Controlling Person. These are for:
- Failure to apply due diligence procedures
- Inaccurate or incomplete reports
- Failure to provide notification to individual reportable persons
If it is determined that the Reporting Financial Institution has a reasonable excuse then no penalty will apply.
The starting amount for the penalty will be determined by the behaviour of the Reporting Financial Institution and the frequency of the failure. Where the behaviour that led to the failure was deliberate, penalties will be higher than if the behaviour was careless. Subsequent failures will lead to increased penalty levels.
When assessing penalty amounts, HMRC will consider all relevant facts and circumstances. The following penalty reduction factors will also be considered:
| Reduction Factor | Details |
|---|---|
| Remedial Action | Was the error corrected within a reasonable period? HMRC would normally consider a period of thirty days to be reasonable, particularly for simple corrections. However, for more complex cases, HMRC may accept that a period of longer than thirty days is still reasonable depending on the particular facts and circumstances. |
| Co-operation | How co-operative has the platform operator been in trying to resolve any issues with their submission? |
| Giving Access | Has the platform operator given HMRC the information they need? |
| Nature of Disclosure | Did the platform operator tell HMRC that there were problems, unprompted? |
| Proportion of Errors | What proportion of the records contain incorrect or inaccurate information? HMRC would normally consider a greater reduction was due where the inaccuracy, omission or failure relates to 10% or fewer of all seller records. |