CCM10050 - Penalties and Interest: Identifying Incorrect Claims – Enquiries or Examinations Opened on or before 5 April 2008

 

You are likely to encounter penalties for incorrect claims in the following situations:-

• an incorrect claim is made and this is picked up during a Section 14, 15 or 16 in-year examination
• an incorrect Section 17 end of year declaration is made and this is picked up during a Section 19 end of year enquiry

In each situation the maximum penalty provided by the legislation is £3,000 but in reality most penalties will be set in a lesser amount. The amount of the penalty will depend on:

• the amount of credits over-claimed as a result of the incorrect application
• whether there have been any previous challenges (see CCM10090) by HMRC for which Section 31(1) penalties were imposed
• the extent to which the person co-operates with the examination or enquiry and discloses details of the irregularities.

Where an incorrect S17 notice has been used to finalise the previous year and has set the provisional award for the current year there is only one penalty - see CCM10040.

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