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HMRC internal manual

VAT Civil Penalties

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HM Revenue & Customs
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Misdeclaration penalty: Discretion, reasonable excuse, and mitigation: Period of grace should be applied retrospectively

Please note: VAT Misdeclaration Penalty has been replaced by the Schedule 24 inaccuracy penalty for all accounting periods where the return period commences on or after 01/04/2008 and the due date is on or after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 period of grace normally applies to all visits after 20 March 1991. The concession should not be overridden without reference to Central Policy Tax Administration & Advice Team.

Many traders have claimed that the provisions announced at the 1991 Budget should be applied retrospectively. Central Policy Tax Administration Advice (TAA) team have consistently rejected this argument, a view that has been supported at Tribunal by several different chairmen.