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HMRC internal manual

VAT Civil Evasion Penalty

From
HM Revenue & Customs
Updated
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Assessment and notification of VAT civil evasion penalty: notification of a section 61 penalty to a named officer

In the case where there is evidence to show the conduct giving rise to the penalty is attributable to the dishonesty of a Named Officer and is to be apportioned, whether wholly or in part, the Company must be notified of the penalty liability under Section 60, in addition to a separate notification of the apportionment under Section 61.

Form VAT 292 cannot be used to impose penalties on unregistered persons.

The penalty assessment for such individuals will therefore be issued in the form of a letter which will include a demand for the amount liable.

Steps to be followed once the criteria to apportion the civil evasion penalty have been met:

  • Notify the incorporated company of the Section 60 penalty by the standard Notification of Civil Evasion Penalty letter (SEES>Forms & Letters>Local Compliance>VAT(LC)).
  • Assess and notify the incorporated company of the apportionment to the Named Officer or officers under Section 61 by the S61 letter to company (SEES>Forms & Letters>Local Compliance>VAT(LC)).
  • (This content has been withheld because of exemptions in the Freedom of Information Act 2000) Advise the officer in the Accounting Team that the penalty cannot be accounted for on a VAT292 and you require a ‘MU reference’ so that the penalty can be accounted for manually. Ensure you have

    • full name and address details of the party to be penalised
    • the amount of the penalty and
    • any associated VRNs to hand.

    Details of your case will be recorded by the Cumbernauld Accounting Team on a central ledger and you will be given a MU reference number to QUOTE ON ALL SUBSEQUENT CORRESPONDENCE.

    • Prepare two hardcopies of the civil evasion penalty S61 letter to the Named Officer (SEES>Forms & Letters>Local Compliance>VAT(LC)), incorporating the reference number you have been given in the header of both letters (that is ‘Our Reference’). Mark one clearly ++ REMITTANCE ADVICE ++
    • Email a copy of the penalty letter to (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .In the subject heading of your email, please ensure that you quote the MU reference number.
    • Send both hard copies to the person.