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HMRC internal manual

VAT Assessments and Error Correction

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HM Revenue & Customs
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How to assess and correct: VAT Amendments: Completing VAT643

Completion of the VAT 643

The VAT 643 should be completed from a template found on the New Penalties website NPS Penalty Toolkit and captured to the customer’s folder in EF.

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

Boxes must be completed as follows:

Trader’s name and address

To be completed by the assessing officer.

Office Code

The three digit code, formerly LVO code, associated with the trader’s registration number on VISION.

Registration number

This is the trader’s VAT registration number.

Last page

To be completed on last page of the VAT643 or VAT643 continuation sheets used.

Original OA reference

The OA reference number of the assessment you are amending. This number is printed on the EF copy of the Notice of Assessment and can also be obtained from VISION.

Line used

Is the total number of lines being amended and will be completed automatically

Officer’s name

Insert your surname. You may also include initials and title if you wish provided sufficient boxes exist, but if you do, you must leave a space, between items. The name will appear on the VAT656 as a reference for the trader. The name will not be retained on the database for statistical or management purposes.

Amendment number

This denotes the number of amendments that have been made to the original assessment, including this amendment. (The number of previous amendments is shown on a previous VAT656.)

Existing line reference

This denotes the line reference on the VAT641 that you are amending. This information can also be obtained from the Officer’s Assessment details on VISION.

Period reference

Enter the period from the VAT641 to be amended. You cannot insert a period not assessed on the VAT641. If the wrong period was assessed, you must cancel the assessment for that period and input a new VAT641.

Attribution code

Each line is to be given an attribution code to reflect the original assessment. In addition to the Attribution Codes as specified in the guidance attached to the electronic form VAT643, you will need to use Attribution Code 8 if you input a VAT643 for periods assessed before 1 December 1993. These can be corrected by use of the existing and amended boxes but care must be taken to include the tax amount on each line.

Due to HMRC

  • Existing detail: This will always be the details held on the trader’s file after the last amendment. If the OA has not previously been amended, the details will be those on the VAT641. If this box is completed a zero should also be placed in the due from HMRC column on that line.
  • Amended details: You should enter the new details in this box. It is possible to amend an under-declaration to nil but you cannot amend it to an over-declaration. It may be that in some cases replacement of an under-declaration by an over-declaration is required. In this case the under-declaration should be reduced to nil and further VAT641 input for the over-declaration. If this box is completed, a zero should also be placed in the due from HMRC column on that line. This document should not be used to reduce all lines to nil. A VAT644 should be used in this situation.

Due from HMRC

  • Existing details: Enter the details currently held on the trader’s file. If completed a zero should be placed in the due to Revenue and Customs column on this line.
  • Amended details: Enter the new assessment details. It is possible to amend an over-declaration to nil but you cannot amend it to an under-declaration. If you complete this box a zero should also be inserted in the due to HMRC column on this line. You cannot enter due to and due from amounts on the same line.

Behaviour type

Existing details: Enter the details currently held on the trader’s file.

Amended details: Enter the new details.

For inaccuracies relating to periods to which the new inaccuracies penalties under Schedule 24 FA 07 apply, the behaviour type appropriate to each under-declaration must be completed:

A - error despite taking reasonable care

B - failure to take reasonable care

C - deliberate understatement

D - deliberate understatement with concealment

U - under-assessment: Although not a behaviour, this is to be used where an additional assessment is being raised because a prime/central assessment is too low ( so against Assessment type 1 lines) and an under-assessment penalty is considered appropriate, see CH81090 and CH410000.

N.B. For periods before New Schedule 24 Penalties, this box should be left blank.

Penalty Percentage Rate

Existing details: Enter the details currently held on the trader’s file.

Amended details: Enter the new details.

For inaccuracies / under-assessments relating to periods to which the new inaccuracy penalties under Schedule 24 FA 07 apply, where the behaviour type is B-D or U, then a PPR must be entered against each under-declaration line.

The PPR is derived from the penalty calculator on SEES (until the New Penalty System becomes available), taking into account whether a disclosure was prompted or unprompted and the quality of that disclosure, seeCH82000 and CH450000.

The minimum and maximum PPRs per behaviour type are:

B: 0 - 30%

C: 20 - 70%

D: 30 - 100%

U: 0-30%.

N.B. For periods before New Schedule 24 Penalties, this box should be left blank

Suspension code

Schedule 24 FA 07 allows for penalties resulting from a failure to take reasonable care to be suspended, see CH83100 and CH450600.

For each line on which behaviour type B is shown, this field must be completed:

  • 0 - suspension not appropriate.
  • 1 - penalty to be suspended
  • Even where a penalty is to be suspended, it must be assessed.

A penalty in respect of a deliberate understatement (with or without concealment) or an underassessment penalty cannot be suspended.

Existing details: Enter the details currently held on the trader’s file.

Amended details: Enter the new details.

N.B. For periods before New Schedule 24 Penalties, this box should be left blank.

Inhibits

Penalty and interest inhibit boxes must be completed as follows

  • 0: inhibit not set
  • 1: inhibit set .

If the inhibit was set on the original VAT641 and it is to remain set, you must complete the box with a 1 and the authorising officer should ensure that its continued use is applicable. If the only reason you are completing a VAT643 is to set the inhibit signal for Misdeclaration Penalty purposes, the VAT643 should be completed showing Assessment of Tax (whole pounds only).

Please ensure that the tax due is repeated on the amended line. If this is not done, the amended assessment will not include the tax due.