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HMRC internal manual

VAT Civil Penalties

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HM Revenue & Customs
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Misdeclaration penalty: Misdeclaration penalty for repeated errors: Cancellation of a Penalty Liability Notice

Please note: VAT Misdeclaration Penalty has been replaced by the Schedule 24 inaccuracy penalty for all accounting periods where the return period commences on or after 01/04/2008 and the due date is on or after 01/04/2009. Misdeclaration penalty will still apply where the due date is before 01/04/2009.

Please see the Compliance Handbook CH80000 Penalties for Inaccuracies for further details.

A Penalty Liability Notice (PLN) will be cancelled if

  • the period which caused the PLN to be served is no longer a Penalty Liability Period (PLP), see VCP10743, and there are no other PLPs within the 5 period span which have also breached the objective tests, or
  • a reasonable excuse inhibit is set on the PLP which caused the PLN to be served and there are no other PLPs within the 5 period span which have also breached the objective tests.

If a PLN is to be cancelled then the mainframe will automatically issue a PLN cancellation to the trader and a copy to the local office.The Penalty Liability Cancellation Notice is issued on Form VAT 671.