V5.302A Civil penalties relating to VAT—overview of key concepts
This overview of key concepts relating to civil penalties that may arise in relation to VAT provides information about:
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•ÌýÌýÌýÌý the concept of reasonable excuse
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•ÌýÌýÌýÌý assessment and notification of penalties
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•ÌýÌýÌýÌý penalty mitigation and HMRC discretion to waive a penalty
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•ÌýÌýÌýÌý civil penalties and interest charges that may arise in relation to VAT with cross-references to more information within this division about each of the penalty and interest charges
The concept of reasonable excuse
A person is not liable to most civil penalties if the person can demonstrate to HMRC or, on appeal, a tribunal, that there was a reasonable excuse for the conduct concerned1.
The test has been put in the following terms2:
'One must ask oneself: was what the taxpayer did a reasonable thing for a responsible trader conscious of and intending to comply with his obligations regarding tax, but having the experience and other relevant attributes of
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Web page updated on 17 Mar 2025 13:48