Unauthorised issue penalty: What to do upon discovery of unauthorised issue: Initial action on discovery of unauthorised issue
Please note: the S 67 VATA 1994 penalty has been replaced by the VAT and Excise Wrongdoing penalty introduced by Schedule 41 Finance Act 2008. The VAT and Excise Wrongdoing penalty applies where a person makes an unauthorised issue of an invoice on or after 01/04/2010. If an unauthorised invoice has been issued before 01/04/2010 the S 67 penalty will continue to apply.
Please see the Compliance Handbook CH90000 Penalties for more information about the VAT and Excise Wrongdoing penalty.
The issue by an unauthorised person of invoices including amounts shown as VAT will normally be discovered
- by the local VAT officer on a routine visit
- as a result of an enquiry from another Local VAT Office.
These cases may be investigated further on the grounds that that they involve dishonest evasion of VAT.
Note: Before the issue of a penalty it should be established that there is no intention of pursuing any dishonesty aspect and a section 60 VAT Act 1994 civil evasion penalty, see VCP10300.
You should consider carefully what the most appropriate course of action is, and it is advisable to have the ultimate decision made at SO level.