SAOG19150 - What to do when there may have been a failure or inaccuracy: discussions with a company or SAO before referral to the Penalties Consistency Panel when there may have been a main duty failure or an inaccurate certificate

The Customer Compliance Manager (CCM), Mid-sized Business Customer Engagement Team (CET) or a Caseworker must obtain authorisation from the Penalties Consistency Panel (‘the panel’) before they discuss penalties with the Senior Accounting Officer (SAO). However, in order to establish whether there might have been a main duty failure and/or an inaccurate certificate the CCM, CET or Caseworker may need to do some fact finding to establish, for example

• whether the tax accounting arrangements are appropriate in a particular area
• what steps the SAO has taken in this area in respect of the main duty
• the SAO’s reasoning for excluding particular shortcomings in the tax accounting arrangements from a certificate.

Provided the CCM’s, CET or Caseworker’s enquiry is limited to establishing these facts, there is no need to seek authorisation from the panel, see SAOG19200. However the CCM, CET or Caseworker must not at this stage

• discuss a potential penalty with either a company or an SAO
• discuss excuses where failures are disclosed or identified.

If a CCM, the CET or a Caseworker believes that it will be impossible to establish these facts without discussing the possibility of penalties with the SAO they should seek the panel’s authorisation before beginning this fact finding, see SAOG19200.

Because SAO penalties are not charged in connection with any tax, they do not fall within the definition of ‘tax position’ at Schedule 36 FA08. Accordingly, you cannot apply the information powers contained in Schedule 36 FA08 in fact finding for SAO penalties.