When an HMRC penalty drops through the post for a deliberate error, it is possible to turn the tide on the decision, explains Bash Khanzada, consultant at Croner-i VIP Tax Team
Dealing with HMRC can be an intimidating experience. When an error is discovered, HMRC will usually consider charging a penalty as part of the enquiry process. They will form a view on the type of behaviour involved, often without fully considering the commercial realities or real-world context behind the error.
It is important to remember that it is not always necessary to accept HMRC’s initial assessment. Careful representation and clear explanation of the circumstances can make a real difference to the outcome.
We recently helped a client navigate this process, successfully downgrading HMRC’s view of the behaviour from ‘deliberate’ to ‘careless’ and ultimately achieving a full suspension of the penalty.
