MLR1PP8250 - Penalties Guidance: The additional starting penalty

The variable additional starting penalty is added to the £5,000 minimum starting penalty to produce the total starting penalty.

Two important points to remember:

1. The additional starting penalty does not apply to registration penalties (which are simply based on the minimum penalty) See MLR1PP8100 
2. The total starting penalty may be restricted by the penalty cap or maximum penalty. See MLR1PP9150 

The fact that the penalty cap may be applicable means that the first thing Compliance Officers should consider is the business's gross profit in the preceding 12 months. See MLR1PP9200 

If this is less than £50,000, the maximum starting penalty will always be capped at £5,000 (10% of £50,000). So under these circumstances there is no need to calculate an additional stating penalty as it will not be applicable. See MLR1PP9150