CH405070 - Charging penalties: suspending penalties: suspension of penalties flowchart
The penalty suspension flowchart will help you arrive at the right decision in the majority of cases. It does not replace the more detailed written guidance found at CH83100+ and CH405000+.
The flowchart and the more detailed guidance reflect HMRC policy, and take account of (but will not always follow) Tribunal decisions. Customers and agents may challenge your decision by citing a particular First Tier Tribunal (FTT) judgment which appears to support another view. You should nevertheless follow the HMRC policy line and explain if necessary that HMRC does not always agree with (unbinding) FTT decisions and that your decision is in line with Departmental policy.