VAT penalties advice 0161 883 2120

Some potential HMRC VAT penalties where we are able to provide VAT expert advice are outlined below. Our VAT consultants provide VAT Appeal specialist advice that can lead to the withdrawal of a VAT penalty.

In some cases it might be possible to have a VAT penalty reduced or suspended.

“Really impressive stuff” on agreeing with HMRC that a repayment of VAT of over £430,000

VAT late registration penalty

There is only a limited amount of time in which to notify HMRC that you have exceeded the VAT registration threshold and that you are therefore liable to be VAT registered. Your “taxable” turnover for the purposes of VAT registration include standard rated, reduced rate and zero rated supplies.

VAT Penalties

The level of a VAT penalty in relation to late VAT registration varies with how late you are in registering for VAT.

Do you have a “reasonable excuse”? Is your effective date of VAT registration correct? Have you recovered the correct amount of Input Tax (VAT on expenses)? These issues could affect the amount of VAT penalty, if any, you might have to pay.

Remember HMRC are also responsible for Self Assessment (SA) tax returns. HMRC have been known to look at a series of SA returns, establish that a VAT registration is not in place and then seek to back date a registration for many years to when the VAT registration should have taken effect.

When dealing with HMRC, VAT Appeal specialist advice may help with reducing a VAT penalty.


VAT penalty for Mis-declaration

An inaccurate VAT return can give rise to a VAT penalty if the inaccuracy was “careless” or “deliberate”. A “careless” VAT error where “Reasonable care” was not taken can give rise to a VAT penalty of 30% of the potential lost revenue.  VAT penalties can relate to potential lost revenue rather than actual lost revenue.

There is the possibility that the VAT penalty may be “suspended”.

VAT Evasion

A civil evasion VAT penalty starts at 100% of the VAT evaded or the potential VAT evaded. In the worst case scenario VAT evasion can lead to a Criminal prosecution with the possibility of a prison sentence.

If HMRC refer to, or give you, “Public Notice 160 compliance checks into indirect tax matters” you could be suspected of VAT Fraud.

Although you do not have to attend a meeting under a PN 160, HMRC expect you to fully co-operate with them. We would not recommend that a business should meet with HMRC during an investigation without a VAT specialist, unless they are legally required to do so.

We would always fully co-operate with HMRC on a clients’ behalf, providing that the information HMRC request is necessary and they are permitted by law to ask for it. We know your rights and, as VAT experts, we will ensure you are treated fairly and courteously throughout.

A VAT fraud investigation is serious. Any resulting VAT penalty can be attributed to a Director.

If you think HMRC suspect you of VAT fraud, or you have already received a letter from HMRC, you need to contact an HMRC VAT Appeal specialist immediately.

We understand that an allegation of VAT fraud can be particularly stressful and that you may be unable to speak during normal office hours. In such situations one of our VAT specialists will often be available for a brief without prejudice, and without obligation, conversation on his mobile, 07973 840 730, Monday to Friday 0800 – 2100 and Saturdays 0800 – 1200.

Please leave a message if your call is not answered and he will return your call as soon as possible.