In what circumstances is a penalty chargeable: who is liable to a penalty if there is more than one SAO
If the Senior Accounting Officer (SAO) changes during a financial year, more than one person will have held the SAO role with the qualifying company.
Failure to carry out the main duty
HMRC can only charge one penalty for a failure to carry out the main duty in respect of a company for a financial year, see SAOG18400.
So in an example where the latest of three SAOs is appointed half way through the year
- if the latest SAO fails in the main duty, the latest SAO is liable to the penalty
- if the latest SAO succeeds in the main duty but their immediate predecessor failed, the predecessor is liable to the penalty
- if the latest SAO succeeds in the main duty but both of the two predecessors failed, the later of the two predecessors is liable to the penalty.
Ultimately the Customer Compliance Manager (CCM), Mid-sized Business Customer Engagement Team (CET) or a Caseworker must demonstrate who it is that has failed in order to assess a penalty.
Failure to provide a certificate
HMRC can only charge one penalty for a failure to provide a certificate in respect of a company for each financial year, see SAOG18500.
Irrespective of how many persons were SAO in the financial year and throughout the period up until the time limit for providing the certificate, the SAO who is liable to a penalty is the person who was the SAO when the time limit for providing the certificate expired.
However, there will be no penalty on that SAO for failing to provide a certificate
- if the SAO has suffered a penalty in relation to another group company for a similar failure for a corresponding financial year, or
- if any other SAO has provided a certificate in respect of that company for that financial year.
Provision of a timely certificate that contains a careless or deliberate inaccuracy
If one of the SAOs for a financial year provides a timely certificate only that SAO is liable to an inaccuracy penalty for that financial year.