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HMRC internal manual

VAT Civil Penalties

Belated Notification Penalty: Right to statutory review and appeal to tribunal: General

Belated Notification Penalty has been replaced by the Failure to Notify penalty introduced by Schedule 41 of the Finance Act 2008. The Failure to Notify penalty applies to obligations to notify HMRC of a liability to be registered for VAT on or after 01/04/2010. The Belated Notification Penalty under Section 67 VATA 1994 continues to apply to obligations to notify a liability to be registered for VAT before 01/04/2010.

Please see the Compliance Handbook CH70000 for more details about the new failure to notify penalty.

Note: Further information about review and appeals can be found in the Appeals Reviews and Tribunals Guidance (ARTG) at ARTG3000.

Once a trader has been notified of the amount of the belated notification penalty they can either

  • do nothing, in which case the decision is treated as accepted
  • provide new information to the decision maker
  • accept HMRC’s offer of a review by an independent Review Officer
  • appeal to the tribunal.

The decision maker is the person who decides that a belated notification penalty should be charged, and notifies the trader of the penalty.

The Review Officer is an officer, not previously involved in the case, who conducts a review of the matter.

Trader provides new information to the decision maker

If the trader does not accept the offer of review but provides new information, the decision maker should consider the information and notify the trader in writing whether or not their view has changed. The decision maker should give the trader a further 30 days within which to appeal or to accept our offer of review or appeal to the tribunal, see ARTG3080 for further information.

Trader accepts offer of independent review

The belated notification penalty notice should offer the trader a review of the decision to charge the penalty if they disagree with it and tell the trader who to contact if they want to accept the offer of review. The offer of review should be accepted within 30 days of the date of the penalty notice.

If the trader accepts the offer of review local procedures should be followed and the case must be referred to the review team as soon as possible. A review must be carried out within 45 days, or a longer agreed period, of the date of the trader’s acceptance.

The penalty should be suspended pending the outcome of the review. This should have been done by the decision maker or review officer, depending on who the trader has contacted to accept the offer of a review, see ARTG3090 and ARTG3310.

Trader appeals to tribunal

When the trader receives the belated notification penalty notice they may decide to appeal to the tribunal. They should do so within 30 days of the notice, see ARTG3100.

If the trader has accepted the offer of review, they must await the outcome of the review before appealing to the tribunal. See ARTG8000+ for further information about tribunal appeals.