ECH21137 - Penalties: Raising Formal Penalty Determinations - Initial Penalties arising under S98(1)(a) or S98(1)(b) TMA 1970

explains the initial action to be taken on all cases when raising formal penalty determinations.

The initial penalty under S98(1)(a) or S98(1)(b) TMA 1970 will be determined by Commissioners. Information will be laid before the Commissioners by an officer of HMRC (Higher Officer or above).

You will

• complete a Penalty Authorisation Request stencil and
• send it to the local Grade 6 officer via the Senior Manager

If the local Grade 6 and Senior Manager agree to pursue formal penalties you will

• prepare a brief (to be used by the officer laying the information) and
• complete a set of 82 forms (see Note).
  
  
• • 82A (records)/ 82A (other) – to lay information before the Commissioners
  • 82B (records)/ 82B (other) – used by the Commissioners to summons the employer/contractor/subcontractor to a hearing
  • 82C (records)/ 82C (other) – the notice issued by Commissioners notifying the employer/contractor/subcontractor of the amount of penalty determined.

Note: When completing the set of 82 forms you must print the following number of copies

• 82A – 2 copies – one copy for the Commissioners and one copy to be retained on file.
• 82B – 3 copies – one copy to be retained by Commissioners, one copy for HMRC and one copy to be issued to the employer/contractor/subcontractor by the Commissioners.
• 82C – 3 copies – one copy to be retained by Commissioners, one copy to be issued to the employer/contractor/subcontractor by the Commissioners and one copy for HMRC.

The Senior Manager will

• proceed to lay information before the Commissioners.

If the Commissioners award the penalty they will determine the amount and issue form 82C. You will

• complete a SAFE referral stencil and
• a penalty notice letter and
• if the failure is to produce records a letter following the Commissioners determination of the initial penalty which requests that the employer/contractor make the records available,
• send the letters, stencil and a copy of the form 82C to the SAFE officer.

The SAFE officer will

• create a charge on SAFE and
• return the documents to you along with a payslip.

You will then

• issue the letters, payslip and an appeals note to the employer/contractor and
• B/F the case for 14 days

If the employer/contractor does not remedy the failure you should

• consider making a referral to the Local Grade 6 officer to determine daily penalties ( ECH21138).

If the employer/contractor appeals against any penalty determinations you should follow the guidance at ECH21260.

Assistance on completing the relevant documents and stencils is at ECH21136.