Changes to Tax Penalties 1

A new penalty regime enacted by the Finance Act 2007 will come into force for Returns covering periods on or after 1 April 2008 and filed after 1 April 2009. The new regime applies to ALL taxes.

Particularly of note from a VAT perspective are the facts that higher penalties will be imposed for deliberate actions.

All the following will disappear

• The current thresholds for misdeclaration penalties,

• the concept of a Voluntary Disclosure removing liability for a penalty, and

• ‘reasonable excuse’.

Once details of the penalties are known we will circulate these.

Elysian Associates
September 2007