Introduction and the law: the law on security: Insurance Premium Tax: penalty for failure to provide security
Paragraph 9(7) of Schedule 7 to the Finance Act 1994 provides
9(7) A person is guilty of an offence if he enters into taxable insurance contracts without giving security (or further security) he has been required to give under paragraph 24 below.
Paragraph 10(7) of Schedule 7 to the Act provides
10(7) A person guilty of an offence under paragraph 9(7) above shall be liable on summary conviction to a penalty of level 5 on the standard scale.
Under section 37 of the Criminal Justice Act 1982 (as amended by Section 17(1) of the Criminal Justice Act 1991), a penalty of level 5 is currently £5,000.