CEP4650 - Civil evasion penalties for Customs, Excise and VAT: apportioning penalties to directors and managing officers: how to apportion

You may have evidence of personal gain to support apportioning a penalty, for example, a director may admit that there was personal gain from the evasion, or it may be clear from the company’s records or the director’s lifestyle that the proceeds from the evasion went directly.

Alternatively, whether or not there has been personal gain, if the corporate body is in insolvency or suspected of incipient insolvency, you should apportion the penalty to the directors/managing officers/managing members for whom there is evidence of dishonesty. This applies even if it is suspected that it would be the imposition of the penalty that would cause the insolvency. You should obtain details of the insolvency or of the information which suggests that the corporate body is about to become insolvent.

Where a penalty is attributable to more than one person, you should divide the penalty equally between them unless there is clear evidence that one dishonest named officer has gained more financially from the evasion than another. In this case you may apportion a greater percentage of the penalty to them.