VATF45280 - Basic interventions: matters to consider when determining whether to use a civil intervention: assessments and penalties: raising penalties in particular circumstances: when to assess

In general, you should aim to issue the penalty at the same time as the knowledge principle (for example, Kittel or Mecsek) decision. Both notices can be sent at the same time.

There may be rare occasions when it is expedient to delay issuing the penalty. One example might be when a knowledge principle decision is approved in advance as suitable for the alternative dispute resolution (ADR) process. In these circumstances it may be desirable to await meeting with the trader as part of the ADR process before determining HMRC’s position on the penalty. The reason for this is that the ADR may entail new arguments being put forward or further evidence being furnished by the business. It is right that HMRC considers these points before issuing any penalty.

Any company officer liability notice can only be issued after the officer has been given a chance to make representations. Therefore, this notice will usually follow some time after the penalty assessment. But the same time limit applies, see VATF45290.