To ensure that businesses comply with the terms of refund agreements they have reached with the Commissioners, Finance Act 1997 Schedule 5, paragraphs 14 to 19 “Recovery of excess payments by the Commissioners” allows HMRC to assess those businesses that have failed to reimburse (repay) their consumers in the manner agreed.
Under paragraph 14(2) “Where any person is liable to pay any amount to the Commissioners in pursuance of an obligation imposed by virtue of paragraph 3(4)(a) above, the Commissioners may, to the best of their judgement, assess the amounts due from that person and notify it to him.”
Paragraph 15 allows an assessment to be issued to recover any amount paid by way of interest, and paragraph 17 allows for interest to be charged on the whole amount of any assessment issued.
In addition to the powers to assess for money, the Finance Act 1997, Schedule 5, paragraph 4(3) also allows us to issue a civil penalty. A penalty may be issued where there is a contravention or failure to comply with any obligation imposed by regulations made by virtue of paragraph 3(4).