CH193240 - Penalty reform - penalties for failure to pay VAT on time from 1 January 2023: penalty assessments: what the assessment must include

NB: “These rules currently only apply to VAT, for VAT periods starting on or after 1 January 2023. These rules will come into force for other tax regimes at a future date. You must check the date from which these rules apply for the tax or duty you are dealing with”

Where HMRC assesses a penalty, the legislation requires that we notify the person and tell them:

  • the failure (or failures) that has (have) led to the person becoming liable to the penalty,
  • the amount of the penalty, and
  • how that amount has been calculated (including the period to which the penalty relates)

The notice must also include :

  • the date of the assessment
  • the legislation under which the penalty is due
  • when it must be paid
  • rights of appeal if the person disagree with the decision to charge a penalty, see CH193320

An assessment of a penalty:

  • is to be treated for procedural purposes in the same way as an assessment to tax,

  • may be enforced as if it was an assessment to tax, and
  • may be combined with an assessment to tax.

The due date for payment of the penalty is the end of the period of 30 days beginning with the day on which the notification of the penalty is issued. If not, it may be subject to Late Payment Interest (LPI).

FA21/SCH26/PARA16