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HMRC internal manual

VAT Civil Penalties

From
HM Revenue & Customs
Updated
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Misdeclaration penalty: misdeclaration penalty for large errors in a single VAT accounting period: objective tests for large errors

Objective tests are used to determine if a trader is liable to a penalty. See VCP10714.

  • Where a return has been processed the objective tests are met whenever a misdeclaration for a period equals or exceeds 30% of gross amount of tax (GAT, see VCP10801) or £1 million.
  • Where no return has been received the objective tests are met whenever a central assessment is accepted which understates the true amount of tax (TAT, see VCP10801) for the period by at least 30% or £1 million, and the trader has not notified HMRC of the true liability within 30 days of the date of the assessment on Form VAT151.