APD5200 - Penalties/interest and debt management: Inhibiting of penalties and assessments and warning letters

Also refer to the procedures table at APD11200

The computer system which accounts for APD automatically issues the penalties and warning letters as described in APD5200 unless an inhibit is input to the system. Discretion must be shown in the issue of such penalties and warning letters, therefore the procedure outlined below must be followed. Further information on the inhibiting of interest on officers’ assessments can be found in APD5200.

(This text has been withheld because of exemptions in the Freedom of Information Act 2000)

Action by the CAT

Upon receipt of the notification from CCU, the CAT must decide whether a central assessment, warning letter or penalty notice should be inhibited or not. In making this decision the officers must consider the effect on compliance - refer to X-51 Civil penalties and assessments for guidance.

If the aircraft operator is contacted and they state that payment has been submitted, the CAT should obtain details of the:

method of payment; amount paid; cheque number if appropriate; date that payment was made; name and sort code of the bank holding the trader’s account; date the transaction was initiated (that is the cheque was posted on....., the credit transfer was initiated on..... etc); date the transaction was effected (that is the trader’s bank account was debited on .....); sort code of the bank the transaction was made from (credit transfer only). This information should then be passed on to CCU who will investigate the matter further.

The CAT must inform CCU by fax of any warning letters or penalties that are to be inhibited. The timescale for responding to CCU will be advised on the original notification from CCU. This is likely to be between 1 and 5 days.

Inhibiting of daily penalties for failure to pay duty

The CAT should monitor the trader’s account each month to confirm that the central assessment or return has been paid. If the trader has not paid the full amount of his prime assessment or return then a fixed daily penalty will be calculated and issued to the trader. Local officers should consider whether this penalty should be issued (use of discretion). If you decide that the fixed daily penalty should be inhibited, you should contact CCU to request that an inhibit is set. Unless an inhibit is set the system will automatically calculate and issue these penalties while the assessment/return remains unpaid.

Warning letters

A warning letter will be generated instead of imposing a failure to pay penalty if there has not been an earlier default in the previous 12 months. In terms of the system an earlier default can be defined as the existence of a penalty or penalty warning which has not been inhibited.