DMBM569060 - Debt and return pursuit: new penalties processes for DMB: Taxes Acts penalties - excise, environmental and customs duties
Some content of this manual is being considered for archiving. If there is content you use regularly, please email [email protected] to let us know as soon as possible.
Penalty assessment
The compliance caseworker will recover any tax due under the relevant HoD system and issue a formal penalty assessment using NPPS. The penalty assessment outlines the overall penalty position to the taxpayer.
Penalty Charge on SAFE
A penalty charge is automatically raised on SAFE using the 9 digit VAT Registration Number (VRN). SAFE issues the relevant payslip and reminders and passes the debt to IDMS if unpaid.
SAFE Charge Reference Number
The SAFE charge reference number is sent to IDMS for use on payslips. It must be used when the taxpayer makes payment by whatever method including debit card, credit card and direct debit.
You can view the SAFE charge reference number via the View Customer Account Role on SAFE. It is in the format X@W plus 11 digits, with @ being the check character.
Additionally, the Penalty ID is the last digits of the SAFE charge reference number, excluding the leading zeros. For example, in the SAFE charge reference number XAW00000012345, the penalty ID is NPPS-12345.
IDMS
These penalties are allocated to the IDMS Organisation Unit (OU) for the DMB Excise, Environmental and Customs Team (EECT) to deal with. The reference number for these penalty work items is the 9 digit VRN and the HoD type is L.
If there are signals/conditions set that take the case out of the automatic process these will also apply to the penalty work item and you should work these cases in accordance with existing guidance.
Suspended Penalties
The legislation allows for penalties due to inaccuracy incurred due to careless behaviour to be suspended for an agreed period of no longer than 2 years. The taxpayer must agree to certain conditions to address the behaviour that led to the penalty. Suspended penalties are not collectible and therefore not passed to DMB for pursuit unless the taxpayer fails to meet the conditions.
IDMS partial suspension
Caseworkers may agree to suspend only part of an inaccuracy penalty leaving the remainder payable. The part of the penalty that is not suspended is raised as a charge on SAFE and if unpaid will move to IDMS as a Taxes Acts penalty work item as described above.
If the Taxes Acts penalty or linked set containing a Taxes Acts penalty work item is awaiting automatic action and an increase is received IDMS moves the singleton or linked set to the appropriate case worker role. It will have a next action of ‘Update Received’ and a next action date of ‘Today’.
You should review the case and take the appropriate next actions, however you must not take any action to pursue the increased part of the Taxes Acts penalty until 30 days after the posting date of the increase.
IDMS release of suspended penalties
If a suspended penalty is released from NPPS because the taxpayer failed to meet the suspension conditions NPPS passes the penalty debt to SAFE which issues a payslip and reminders, and passes the debt to IDMS if unpaid.
Enforcement
You can enforce these penalties using the County Court Bulk Centre (CCBC).
There is a drop down list on IDMS of all the penalty types to aid DMB Enforcement & Insolvency Service (EIS) for use in their statutory demands and petitions.
Alternative rights of recovery - companies only
Where a penalty is payable by a company the legislation allows that an officer of the company can be made liable for a portion of the penalty.
Company officer details on SAFE
If the penalty was raised on SAFE and you are unable to recover the debt from the company you can check the Local Ref on View Customer Account to see if the case has an alternative source of recovery.
Where the last 3 digits of the Local Ref are 777 (for example, 10000123451111777), this indicates that company officer details are held on NPPS.
Checking company officer details on NPPS
You need to ask a DMB NPPS nominee to check NPPS for information about the company officer liability and on receipt of the information pursue the officer(s) for their portion of the debt, taking relevant recovery actions where necessary.
Alternative site address held for traders
Traders involved in alcohol, tobacco, oils, environmental taxes, betting and gaming and air passenger duty need an approval/registration from HMRC for each site that they operate from. The site is the legal entity and one of the sites will be the head office.
Compliance activity is performed at each approved site and therefore the formal penalty assessment for these traders is issued to the site address. Caseworkers will also send a copy of the penalty assessment to the head office address and note this on NPPS.
All DMB correspondence including the payslip is sent to the head office address, however, if for the purposes of enforcement of the penalty debt you need the site address you need to ask a DMB nominee to check NPPS for details of the site address.