Commentary

V5.349 Failure to notify goods acquired from another EU member state

Part V5 Compliance, enforcement and appeals

V5.349 Failure to notify goods acquired from another EU member state

V5.349 Failure to notify goods acquired from another EU member state

Provisions applicable until 31 March 2010

The provisions relating to failure to notify such an event were changed with effect from 1 April 2010. However, the pre-existing provisions still apply where the obligation to notify arose prior to 1 April 2010. Given that HMRC may assess tax and penalties for 20 years where a deliberate failure gives rise to a VAT loss, a description of the earlier provisions has been retained.

A person is required to notify1 an acquisition of goods from another EU member state in the circumstances described in V5.126 (acquisition of goods subject to excise duty by non-taxable persons) and V5.127 (acquisition of new means of transport by non-taxable persons). He is liable to a penalty if he fails to comply with this requirement2.

However, such conduct does not give rise to liability to a penalty if the person concerned either3

  1.  

    (1)     satisfies HMRC or, on appeal, a tribunal that there is a reasonable excuse4 for his conduct;

  2.  

    (2)     is convicted of an offence in respect of it; or

  3.  

    (3)     is assessed to a civil penalty for dishonest conduct5 in respect of it.

Penalty

The prescribed penalty is £50 (where there is no relevant VAT) or the greater of £50 and the specified percentage of relevant VAT (in other cases)6. “Relevant VAT” for this purpose is the tax on the acquisition to which the failure relates7.

The “specified percentage” is 5 per cent (where the failure in question did not continue

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