FHDDS51535 - Penalties, sanctions and offences: penalties – policy: Trading without approval - Examples of unprompted or prompted disclosure

Example 1

John takes over a logistics business which supplies imported goods fulfilment services. He does not realise he needs to be approved before he can start trading. He reads about the FHDDS in a HMRC article in trade press and contacts HMRC immediately. This is an unprompted disclosure.

Example 2

John takes over a logistics business which supplies imported goods fulfilment services. He does not realise he needs to be approved before he can start trading. He is contacted by HMRC who received notification from the previous owner that they wanted to cancel their FHDDS number as they had sold their business. John realises we have information suggesting he is trading without approval and tells us about it. This is a prompted disclosure because we made the initial contact with him.

Maximum and minimum penalties for each type of behaviour

The following tables show the maximum and minimum penalty percentages for each type of behaviour.

Deliberate and concealed

	Percentage of ‘maximum amount’	Monetary value
Maximum penalty	100%	£10,000
Minimum penalty for prompted disclosure	100%	£10,000
Minimum penalty for unprompted disclosure	30%	£3,000

Deliberate but not concealed

	Percentage of ‘maximum amount’	Monetary value
Maximum penalty	70%	£7,000
Minimum penalty for prompted disclosure	35%	£3,500
Minimum penalty for unprompted disclosure	20%	£2,000

Non-deliberate (without reasonable excuse)

	Percentage of ‘maximum amount’	Monetary value
Maximum penalty	30%	£3,000
Minimum penalty for prompted disclosure	20%	£2,000
Minimum penalty for unprompted disclosure	10%	£1,000