Penalties - EC Sales List - failure to file and inaccuracies

By Tolley
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The following Value Added Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Penalties - EC Sales List - failure to file and inaccuracies
  • Failure to submit an ESL
  • Submitting a materially inaccurate ESL
  • Reasonable excuse
  • Calculating and notifying the penalty
  • Reviews and appeals

This guidance note provides an overview of the penalties that can be imposed on a business that either fails to submit an EC Sales List (ESL) or submits a materially inaccurate ESL. This note should be read in conjunction with the EC Sales List (ESL) guidance note. UK VAT registered businesses that make supplies of goods or services to customers who are VAT registered in other EU member states are required to complete and submit an ESL.

A penalty that is levied under these provisions cannot be mitigated.

Failure to submit an ESL

Most businesses submit their ESLs on a calendar quarterly basis, but can also be submitted on an annual or monthly basis. The date the ESL must reach HMRC depends on whether a paper or electronic submission is being made.

VCP10900; SI 1995/2518, Reg 22; VATA 1994, Sch 11, paras 2–3; VATA 1994, s 66
  • paper ESL ― within 14 days of the end of the return period
  • online ESL ― within 21 days of the end of the return period

Businesses that fail to submit their ESL by the due date can be liable to a penalty under these provisions, unless HMRC uses its discretion not to impose a penalty or because the business has a reasonable excuse.

Submitting a materially inaccurate ESL

HMRC can impose a penalty where a business has made a material inaccuracy on its ESLs and does not have a reasonable excuse for the inaccuracy. HMRC is required to issue a written warning within six months of the discovery of a material inaccuracy before it can levy a penalty.

VCP11000; VATA 1994, Sch 11, paras 2–3; SI 1995/2518, Reg 22; VATA 1994, s 65

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