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HMRC internal manual

VAT Civil Penalties

HM Revenue & Customs
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Unauthorised issue penalty: Collection of the penalty: Enforcement Action

Please note: the S 67 VATA 1994 penalty has been replaced by the VAT and Excise Wrongdoing penalty introduced by Schedule 41 Finance Act 2008.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.

If the trader fails to pay the sum demanded within 30 days the matter is referred by the Birmingham Tax Accounting Centre to Liverpool DMU.

It should be noted that unlike the amount shown as tax on the invoices (which is not ‘tax’ as defined by section 4 of the VAT Act 1994 but is a debt to the crown) the civil penalty is recoverable as if it was tax due [VAT Act 1994 section 76(9)].

However, for enforcement purposes a distinction will be made between the tax and the civil penalty. In the event of non - payment of the sums demanded, civil recovery procedures are to be recommended.

In the event that the trader pays the ‘tax’ demanded but fails to pay the amount of the civil penalty charged, normal distress action should proceed for the unpaid penalty amount.

Requests for time to pay should follow the general principles governing consideration of time to pay.

All decisions in relation to time to pay will be made by Liverpool DMU.