Commentary

A4.594 Time limits for assessment of penalties

Administration and compliance

A4.594 Time limits for assessment of penalties

A4.594 Time limits for assessment of penalties

Time limits for assessment—harmonised penalty regime

As indicated below, some of the time limits for assessment of penalties are linked to time limits for assessment of the substantive liability. With effect from 1 April 2010, time limits changed for those substantive assessments and claims, see A4.320–A4.325A1.

Inaccuracy in a return etc

The time limit for the issue of a penalty assessment for inaccuracy is the last day of the period of 12 months beginning with2:

  1.  

    (a)     the end of the appeal period for the decision correcting the inaccuracy; or

  2.  

    (b)     if no assessment (within (a) above) to recover the tax has been issued, the date on which the inaccuracy is corrected

An assessment is made under (b) above must be made before the end of the period of 12 months beginning with3:

  1.  

    (i)     the end of the appeal period for the tax assessment which corrected the understatement; or

  2.  

    (ii)     if there is no such assessment, the date on which the understatement is corrected

Failure to notify

Where an assessment to recover the tax arising from the failure for the year in question has been issued, the penalty assessment must be made within 12 months of the earlier of:

  1.  

    (a)     expiry of the thirty-day appeal period for the

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