There may be occasions when you disagree with a decision made by HM Revenue & Customs (HMRC). If this happens, you may be able to challenge the decision by asking for it to be reviewed or by appealing to an independent tribunal.
If you don't comply with the Money Laundering Regulations HMRC may impose a penalty. In more serious cases they may consider criminal prosecution.
This guide tells you what you can do if you don't agree with an HMRC decision. It explains how to ask for an HMRC review and how you can appeal to the tribunal. It also tells you about civil penalties and criminal offences under the Money Laundering Regulations, the Proceeds of Crime Act 2002, and the Terrorism Act 2000.
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If HMRC makes a decision that you don't agree with you may be able to challenge it.
You might want to challenge an HMRC decision if they:
When HMRC tells you about a decision they'll usually also offer you an opportunity to have the decision reviewed by an officer who wasn't involved in making the original decision.
If the decision was to refuse to register your business or to cancel your registration you can't continue trading while a review is being carried out.
If you're not satisfied with the outcome of the review you can appeal to the tribunal.
You can find out more by following the link below.
If you follow HMRC's Money Laundering Regulations guidance you can be assured that you will be protected from penalties and prosecution. However, if your business doesn't comply with the Money Laundering Regulations, HMRC can take various measures which range from warning letters to criminal prosecution.
The aim of these measures is to encourage you to comply with the regulations. Normally, the first step if HMRC discovers that you are not complying is to explain what you should be doing and provide you with guidance, advice and information. At the same time HMRC will issue you a letter warning that they may impose a penalty if you don't comply in future.
If you still fail to comply with the regulations, HMRC will consider whether to impose a penalty. If they do impose a penalty and you continue to be non-compliant, HMRC can impose further penalties, increasing the amount of the penalty each time.
If imposing penalties is not enough to make you comply with the regulations HMRC will consider criminal prosecution.
A penalty that HMRC imposes for failing to comply with the regulations must be appropriate for the failure and at a level that:
The amount of the penalty will take account of the:
To encourage compliance, HMRC will allow reductions to the penalty amount when you make an unprompted disclosure that you have breached the regulations, and you include an undertaking specifying how you intend to change this by becoming fully compliant with them. An unprompted disclosure means that you must contact HMRC before they contact you in respect of any type of enquiry or intervention.
The correct way to make a disclosure is in writing to:
HMRC AMLS Central Intervention Team
7th Floor NW, Alexander House
21 Victoria Avenue
Southend on Sea
You can get more detailed information about the penalties for failing to comply with the Money Laundering Regulations by following the link below:
If you are charged a penalty you can find information on how to pay HMRC by following the link below.
If you don't comply with the Money Laundering Regulations it's likely that you'll also commit offences under both of the following:
You can get more detailed information about the criminal offences and penalties for money laundering and terrorist financing in Appendix 1 of the following HMRC leaflets: