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Failure to notify penalty

An insurer or a taxable intermediary who failed to notify HMRC that it should have been registered before 1 April 2010 is liable to a penalty of £250 or 5% of the relevant tax, whichever is greater¹ unless it can satisfy HMRC or, on appeal, the tribunal, that there is a reasonable excuse for not registering².

The relevant tax means the tax for the period from the date it is required to be registered to the date HMRC is notified of the liability to be registered or the date HMRC becomes aware of the requirement to be registered³.

A penalty will not be charged if either the insurer or taxable intermediary has been convicted of an offence, whether under FA 1994, Sch 7 or otherwise, or has been assessed to a penalty under the provisions relating to evasion⁴ (see below).

The Treasury has the power to amend by order the amount of the penalty if there has