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HMRC internal manual

Self Assessment Manual

From
HM Revenue & Customs
Updated
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Appeals, postponements and reviews: appeals: appeal against the non-capping of a FAP for tax years 2009-10 and earlier (Action Guide)

For 2009-10 and earlier tax years, the SA system will automatically reduce fixed automatic penalties to the correct amount in the majority of cases.

When dealing with an appeal against the non-capping of a fixed automatic penalty consider steps 1 - 12 below.

Remember that before you can settle a reasonable excuse appeal against a fixed automatic penalty, the overdue return must be filed.

The guide is presented as follows

  Step 1
   
  Steps 2 - 4
  Step 5
  Steps 6 - 8
  Steps 9 - 12

Initial action

1. Check whether the return has been filed and captured using function MAINTAIN RETURN SUMMARY
   
  If the return has been captured
  * Go to step 2
  If the return has been filed but not captured
  * Go to step 5
  If the return has not been filed
  * Go to step 6

Return captured

2. Using function VIEW STATEMENT
   
  * Confirm that the amount shown in box 18.3 (total tax due for the year) minus any amounts paid at the filing date is equal to or more than the amount of the fixed automatic penalties charged
3. If the amount payable is £100 (or £200 where the second penalty has been raised) or more
  * Take no further action in connection with capping (the penalty is valid)
  If there is nothing payable
  * Cancel the penalty using function AMEND FIXED PENALTIES
  If the amount payable is less than £100 (or £200 where the second penalty has been raised)
  * Ask the Recovery Office to reduce (cap) the penalty
  The Recovery Office will partially remit the fixed penalty under Class 10 to cap the penalty
4. After you have dealt with the appeal
  * Follow steps 10 - 13 below

Return filed but not captured

| 5. | If the return has been filed but not captured | || |   | * Arrange early processing
 
And after capture | |   | * Proceed as in steps 2 - 4 above |

Return not filed

| 6. | Write to the taxpayer explaining that | || |   | * You need the return to prove the claim for relief * The penalty remains due and payable in the meantime | | 7. | If you believe that further tax may be due | |   | * Ask the Recovery Office to make a Revenue determination
 
But do not do so just to force receipt of the return. You must have some clear indication that further tax is due | | 8. | After writing to the taxpayer as in 6 above | |   | * Follow steps 9 - 12 below |

Final actions - all cases

After you have dealt with the taxpayer’s claim

9. Close the appeal using function MAINTAIN APPEALS
   
10. Cancel the informal standover using Function MAINTAIN STANDOVERS
11. Record the action taken using function MAINTAIN SA NOTES
12. Advise the taxpayer of the outcome of the claim