HMRC introduces new fines for breaking VAT rules
Thursday January 28, 2010
UK tax authority HM Revenue and Customs (HMRC) has announced the imminent introduction of new penalties for non-compliance of VAT rules.
From April 1st 2010, issuing an invoice charging VAT when not registered for VAT and handling goods which have not had excise duty paid on them will attract a fine.
Those who deliberately use or supply products at a lower rate of excise duty will also be liable to penalties.
Fines will be levied depending on whether the contravention was deliberate and concealed; deliberate but not concealed or done unknowingly.
The penalty levels are graded at between ten per cent and 100 per cent of the potential lost revenue, such as the amount of VAT on an authorised invoice.
Those who contravene VAT regulations but have a “reasonable excuse” will not be charged a fine and reductions will be available based on whether a disclosure of wrongdoing is provided.
Speaking at the European Parliament, Elena Salgado, Spain’s second deputy prime minister recently reaffirmed the Spanish EU presidency’s commitment to combating VAT fraud.