Tax avoidance scheme factsheets: accelerated payments and follower notices

HMRC's factsheet CC/FS7c says it explains how HMRC will consider charging penalties if you sent HMRC an inaccurate return or other document, where the inaccuracy relates to the use of tax avoidance arrangements.

“This factsheet tells you how we’ll consider charging penalties if you sent us an inaccurate return or other document. We’ll consider penalties if the inaccuracy: … relates to the use of tax avoidance arrangements”

HMRC's factsheet CC/FS7c says HMRC asks you to read it because HMRC believes you used tax avoidance arrangements that do not work, there is an inaccuracy in your return or other document, and HMRC is considering charging a penalty for it.

“We have asked you to read this factsheet because: … we believe you used tax avoidance arrangements that do not work … there is an inaccuracy in your return or other document … we’re considering charging you a penalty for the inaccuracy”

HMRC's factsheet CC/FS7c says it applies to returns or documents relating to a tax period that began on or after 6 April 2017 and ended after 15 November 2017, which were sent to HMRC on or after 16 November 2017.

“It applies to returns or documents that: … relate to a tax period that began on or after 6 April 2017 and ended after 15 November 2017 … were sent to us on or after 16 November 2017”

HMRC's factsheet CC/FS7c says HMRC may charge a penalty if you sent a return or other document containing an inaccuracy and all of three things apply: tax is understated or over-claimed, the inaccuracy relates to tax avoidance arrangements that do not work, and the behaviour behind it was careless.

“We may charge you a penalty if you sent us a return or other document that contained an inaccuracy … and all of the following apply: … tax is understated or over-claimed because of the inaccuracy … the inaccuracy relates to the use of tax avoidance arrangements that do not work … the behaviour that caused the inaccuracy was careless”

HMRC's factsheet CC/FS7c explains its terms: tax avoidance arrangements are arrangements that try to use tax legislation to gain an advantage not intended by it, and arrangements 'do not work' where a return was sent on the basis that they have a particular effect but they do not have it.

“Tax avoidance arrangements are arrangements that try to use tax legislation to gain an advantage that is not intended by the legislation. … When we say tax arrangements ‘do not work’, this means a tax return or other document has been sent to us on the basis that tax avoidance arrangements have a particular effect. But they do not have that effect.”

HMRC's factsheet CC/FS7c says that where the inaccuracy relates to tax avoidance arrangements, the law requires you to satisfy HMRC that you took reasonable care. If you do not, HMRC says it will presume the behaviour is careless, unless it believes it was deliberate, or deliberate and concealed.

“The law says when the inaccuracy in your return or document relates to tax avoidance arrangements, you have to satisfy us that you have taken reasonable care. … If you do not, then we will presume the behaviour is careless, unless we believe it was deliberate, or deliberate and concealed.”

HMRC's factsheet CC/FS7c says that if you took reasonable care to get things right but your return or other document still contains an inaccuracy, HMRC will not charge you a penalty.

“If you took reasonable care to get things right but your return or other document still contains an inaccuracy, we will not charge you a penalty.”

HMRC's factsheet CC/FS7c says that if HMRC charges an inaccuracy penalty for not taking reasonable care, you can appeal if you disagree, and that where HMRC has presumed careless behaviour on tax avoidance arrangements, you have to satisfy the tribunal that you took reasonable care.

“If we charge you an inaccuracy penalty for not taking reasonable care, you’ll be able to appeal if you disagree. If the inaccuracy penalty relates to tax avoidance arrangements and we have presumed the behaviour is careless, you’ll have to satisfy the tribunal that you took reasonable care.”

HMRC's factsheet CC/FS7c gives examples of ways to demonstrate reasonable care, including checking as far as you can whether the arrangements have the effect shown in your return and making sure your tax adviser has the appropriate expertise.

“Examples of ways that you can demonstrate you have taken reasonable care are: … checking, as much as you can, whether the arrangements have the effect that is shown in your return or other document … making sure your tax adviser has the appropriate expertise”

HMRC's factsheet CC/FS7c says that HMRC is unlikely to decide to suspend a penalty that relates to the use of tax avoidance, because it goes against HMRC's anti-avoidance strategy.

“We’re unlikely to decide to suspend a penalty that relates to the use of tax avoidance. This is because it goes against our anti-avoidance strategy.”

HMRC's factsheet CC/FS7c says that if you have health or personal circumstances that may make it difficult to deal with HMRC, you can tell the officer who contacted you, and HMRC will help in whatever way it can.

“If you have any health or personal circumstances that may make it difficult for you to deal with us, please tell the officer that’s contacted you. We’ll help you in whatever way we can.”

HMRC's factsheet CC/FS7c says you can ask someone else to deal with HMRC on your behalf, for example a professional adviser, friend or relative.

“You can also ask someone else to deal with us on your behalf, for example, a professional adviser, friend or relative.”

HMRC's factsheet CC/FS24 says HMRC gives it to people it says have used a tax avoidance scheme, and that HMRC will soon ask them to pay the amount that relates to their use of the scheme. It calls such a payment an accelerated payment, or an accelerated partner payment for partnership members.

“We’ve given you this factsheet because you’ve used a tax avoidance scheme, and we’ll soon ask you to make a payment of the amount that relates to your use of the scheme. … Such a payment is known as an accelerated payment, or in the case of members of a partnership, it’s known as an accelerated partner payment.”

HMRC's factsheet CC/FS24 says HMRC may send an accelerated payment notice to a person who has used an avoidance scheme if there is a current compliance check into their return or claim or an open appeal (Condition A), and the return, claim or appeal is made on the basis of a tax advantage from the scheme (Condition B).

“We may send an accelerated payment notice to a person who has used an avoidance scheme if: … there’s a current compliance check into their return or claim (or for partnerships, into the partnership return or claim), or there is an open appeal (Condition A) … the return, claim, or appeal is made on the basis that there’s a tax advantage from the avoidance scheme used (Condition B)”

HMRC's factsheet CC/FS24 says that, in addition, one or more further conditions (Condition C) must apply, such as that HMRC has given the person a follower notice, or the person has used arrangements that are disclosable under the DOTAS legislation.

“and one or more of the following applies (Condition C) … we’ve given the person (or the nominated partner) a follower notice … the person (or the partnership) has used arrangements that are disclosable under the disclosure of tax avoidance schemes (DOTAS) legislation”

HMRC's factsheet CC/FS24 says the accelerated payment notice will tell you how much you need to pay and when, how HMRC worked out the amount, and what you can do if you disagree with it.

“If we need you to make an accelerated payment, we’ll send you an accelerated payment notice which will tell you: … how much you need to pay and when … how we’ve worked out the amount you need to pay … what you can do if you disagree with it”

HMRC's factsheet CC/FS24 says HMRC works out the amount to the best of its information and belief, so the amount in the notice may differ from the amount due when the compliance check is complete or the appeal is settled. It says it will normally repay any overpayment with interest due.

“We’ll work out the amount to the best of our information and belief. If we do not have all the information we need to establish the exact amount, then the amount shown in the accelerated payment notice may not be the same as the amount due when your compliance check is complete, or your appeal is settled. … we’ll normally repay any amount that you’ve overpaid.”

HMRC's factsheet CC/FS24 says payment will be due 90 days after the date you receive the accelerated payment notice, and that making representations objecting to the notice may change the date the payment is due.

“Payment will be due 90 days after the date you receive the accelerated payment notice. … If you make representations objecting to the accelerated payment notice, the date the payment is due may change.”

HMRC's factsheet CC/FS24 says there is no right of appeal against an accelerated payment notice, but you can make representations to HMRC if you believe the conditions for issuing it have not been met or the amount shown is not correct.

“There’s no right of appeal against an accelerated payment notice. However, you can make representations to us if you believe that one or both of the following applies: … the conditions for issuing the notice have not been met … the amount shown in the notice is not correct”

HMRC's factsheet CC/FS24 says representations must be in writing and sent no later than 90 calendar days from the date you receive the notice, and that you cannot make representations once the 90 calendar days has passed.

“Your representations must be in writing, and you must make sure that you send your letter no later than 90 calendar days from the date that you receive the notice. … You cannot make representations once the 90 calendar days has passed.”

HMRC's factsheet CC/FS24 says that if you make representations before the payment due date and HMRC does not withdraw the notice, the deadline for paying may be extended, to the later of the due date in the notice and 30 days after you receive HMRC's decision on your representations.

“However, if you make representations before the date the payment is due, and we do not withdraw the notice, the deadline for paying may be extended. Payment will be due on the later of: … the due date shown in the accelerated payment notice … 30 days after the date on which you receive our decision about the representations you made”

HMRC's factsheet CC/FS24 says that where there is a current compliance check and the full amount in the notice is not paid by the due date, you will be liable to a penalty equal to 5% of the amount you still owe, payable as well as the accelerated payment.

“If there’s a current compliance check and you do not pay the full amount shown in your accelerated payment notice by the date it’s due, you’ll be liable to a penalty. If we charge you a penalty, you’ll have to pay it as well as the accelerated payment. … the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe”

HMRC's factsheet CC/FS24 says that if payment is still not made in full within 5 months of the due date, a further penalty of 5% of the amount still owed applies, and another 5% if it is not paid within 11 months, as well as the earlier penalties.

“If your payment is not made in full on or before: … 5 months of the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe … 11 months of the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe … this is as well as the 2 earlier 5% penalties”

HMRC's factsheet CC/FS24 says that if you think you may have problems paying, it asks to be told straightaway, and that if you have health or personal circumstances that make it difficult to deal with HMRC you can tell the officer who contacted you.

“If you think you may have problems paying, tell us straightaway. … If you have any health or personal circumstances that may make it difficult for you to deal with us, please tell the officer who has contacted you.”

HMRC's factsheet CC/FS25a says HMRC gives it to people it says have used a tax avoidance scheme, and that HMRC will soon write to tell them about taking corrective action to avoid a penalty and about making a payment of the amount that relates to their use of the scheme.

“We’ve given you this factsheet because you’ve used a tax avoidance scheme, and we’ll soon write to tell you about: … taking corrective action to avoid a penalty … making a payment of the amount that relates to your use of the scheme”

HMRC's factsheet CC/FS25a says a follower notice tells the follower they will be liable to a penalty if they do not settle their dispute with HMRC, and that the penalty for not taking corrective action on time is equal to 50% of the tax or NICs in dispute.

“A follower notice tells the follower that they’ll be liable to pay a penalty if they do not settle their dispute with us. … The amount of the penalty for not taking corrective action on time is equal to 50% of the tax or NICs in dispute”

HMRC's factsheet CC/FS25a says that if a court or tribunal has made a final ruling that a tax avoidance scheme does not achieve the tax advantage, HMRC may send a follower notice to followers if certain conditions are met, including a current compliance check into their return or claim, or an open appeal.

“If a court or tribunal has made a final ruling that a tax avoidance scheme does not achieve the tax advantage, we may send a follower notice to the followers if certain conditions are met. … there’s a current compliance check (referred to in the legislation as a tax enquiry) into their return or claim, or there’s an open appeal”

HMRC's factsheet CC/FS25a says that where the final ruling was made after the legislation was introduced, HMRC can send a follower notice up to 12 months after the later of the date of the ruling and the date it received the return or claim, or the appeal was made.

“If a court or tribunal made the final ruling after the legislation was introduced, we can send a follower notice up to 12 months after the later of the date on which: … the court or tribunal made the final ruling … we received the return or claim, or the appeal was made”

HMRC's factsheet CC/FS25a says a follower notice will tell you how to take corrective action and when. It lists the corrective action as whichever is relevant of amending your return or claim, settling your appeal, or entering into a written agreement.

“we’ll send you a follower notice, which will tell you how to take corrective action and when. … This will mean taking whichever of the following actions is relevant: … amending your return or claim … settling your appeal … entering into a written agreement”

HMRC's factsheet CC/FS25a says there is no right of appeal against a follower notice, but you can make representations to HMRC if you believe, for example, that the court or tribunal ruling given in the notice is not relevant to the scheme you used, or that you received the notice after the deadline for sending it.

“There’s no right of appeal against a follower notice. However, you can make representations to us if you believe that one or more of the following applies: … the final court or tribunal ruling given in the notice is not relevant to the tax avoidance scheme that you used … you received the notice after the deadline for us sending it to you”

HMRC's factsheet CC/FS25a says representations about a follower notice must be in writing and sent no later than 90 calendar days from the date you receive the notice, and that you cannot make representations once the 90 calendar days has passed.

“Your representations must be in writing, and you must make sure that you send your letter no later than 90 calendar days from the date you receive the follower notice. … You cannot make representations once the 90 calendar days has passed.”

HMRC's factsheet CC/FS25a says that if you decide not to take corrective action on time you will be liable to a penalty, unless HMRC or the tribunal agree it was reasonable in the circumstances not to have taken corrective action.

“If you decide not to take corrective action on time, you’ll be liable to pay a penalty … unless we or the tribunal agree that it was reasonable in the circumstances for you not to have taken corrective action”

HMRC's factsheet CC/FS25a says HMRC can reduce the penalty percentage rate if you have co-operated with it before it sends a notice of penalty assessment, but cannot reduce the rate to less than 10%.

“We can reduce the penalty percentage rate if you’ve co-operated with us before we send a notice of penalty assessment. … We cannot reduce the penalty percentage rate to less than 10%.”

HMRC's factsheet CC/FS25a says that if HMRC charges a penalty for not taking corrective action you can appeal against the amount of the penalty, and can also appeal if, for example, you believe the court or tribunal ruling in the follower notice is not relevant to the scheme you used.

“You can appeal against the amount of the penalty. You can also appeal if you believe that one or more of the following applies: … the final court or tribunal ruling given in the follower notice is not relevant to the tax avoidance scheme that you used”

HMRC's factsheet CC/FS25a says payment of an accelerated payment notice will be due 90 calendar days after you receive it, which may change if you object. It also says that if both a follower notice and an accelerated payment notice are sent, the accelerated payment is to be paid whether or not you will take corrective action.

“Payment will be due 90 calendar days after the date you receive the accelerated payment notice. If you make representations objecting to the accelerated payment notice, the date the payment is due may change. … you should pay the accelerated payment whether or not you’re going to take corrective action.”

HMRC's factsheet CC/FS25a says that if you think you may have problems paying, it asks to be told straightaway, and that you can ask someone else to deal with HMRC on your behalf, for example a professional adviser, friend or relative.

“If you think you may have problems paying, tell us straightaway. … You can also ask someone else to deal with us on your behalf, for example, a professional adviser, friend or relative.”

HMRC's factsheet CC/FS25b says HMRC gives it to members of a partnership that HMRC says has used a tax avoidance scheme, and that HMRC will soon write to the representative partner about taking corrective action to avoid a penalty, and to the relevant partners asking them to make a payment relating to their share of the partnership's use of the scheme.

“We’ve given you this factsheet because you’re a member of a partnership that’s used a tax avoidance scheme, and we’ll soon write to the: … representative partner to tell them about taking corrective action to avoid a penalty … relevant partners to ask them to make a payment of the amount that relates to their share of the partnership’s use of the scheme”

HMRC's factsheet CC/FS25b explains its terms: the representative partner is the person required to deliver the partnership return or a successor to that person, and a relevant partner is a person who was a member of the partnership at any time during the period the return relates to.

“The term ‘representative partner’ means the person who’s required to deliver the partnership return or a successor to that person. The term ‘relevant partner’ means a person who was a member of the partnership at any time during the period to which the return relates.”

HMRC's factsheet CC/FS25b says that if a court or tribunal has made a final ruling that a tax avoidance scheme does not achieve the tax advantage, HMRC may send a partnership follower notice to the representative partner if certain conditions are met, including a current compliance check into the partnership return or an open appeal.

“If a court or tribunal has made a final ruling that a tax avoidance scheme does not achieve the tax advantage, we may send a partnership follower notice to the representative partner if certain conditions are met. … there’s a current compliance check (referred to in the legislation as a ‘tax enquiry’) into the partnership return, or there’s an open appeal”

HMRC's factsheet CC/FS25b says that where a partnership has used a tax avoidance scheme, HMRC may send a partner payment notice to the relevant partners if certain conditions are met, including a current compliance check into the partnership return or an open appeal.

“Where a partnership has used a tax avoidance scheme, we may send a partner payment notice to the relevant partners if certain conditions are met. … there’s a current compliance check into the partnership return, or there’s an open appeal”

HMRC's factsheet CC/FS25b says a partnership follower notice tells the partnership that each relevant partner will be liable to a penalty if the partnership does not settle its dispute with HMRC, and that the total penalty will be equal to 20% of the value of the denied advantage, shared between the relevant partners.

“A partnership follower notice tells the partnership that each relevant partner will be liable to pay a penalty if the partnership does not settle its dispute with us. … The total amount of the penalties will be equal to 20% of the value of the denied advantage, and each relevant partner will be liable to their appropriate share of that amount.”

HMRC's factsheet CC/FS25b says there is no right of appeal against a partnership follower notice, but the representative partner can make representations to HMRC if they believe, for example, that the court or tribunal ruling given in the notice is not relevant to the scheme the partnership used, or that they received the notice after the deadline for sending it.

“There’s no right of appeal against a partnership follower notice. However, the representative partner can make representations to us if they believe that one or more of the following applies: … the final court or tribunal ruling given in the notice is not relevant to the tax avoidance scheme that the partnership used … they received the notice after the deadline for us sending it to them”

HMRC's factsheet CC/FS25b says only the representative partner can make representations about a partnership follower notice, that they must be in writing and sent no later than 90 calendar days from receiving the notice, and that representations cannot be made once the 90 calendar days has passed.

“Only the representative partner can make representations. The representations must be in writing, and the representative partner must make sure they send their letter no later than 90 calendar days from the date they receive the partnership follower notice. … Representations cannot be made once the 90 calendar days has passed.”

HMRC's factsheet CC/FS25b says that if the representations are made before the date given in the notice and HMRC does not withdraw the notice, the deadline for taking corrective action may be extended, to the later of the date in the notice and 30 days after the representative partner receives HMRC's decision.

“If the representations are made before the date given in the notice, and we do not withdraw the notice, the deadline for taking corrective action may be extended. The deadline will be the later of: … the date shown in the partnership follower notice … 30 days after the date on which the representative partner receives our decision about the representations they made”

HMRC's factsheet CC/FS25b says HMRC can reduce the penalty percentage rate if the partnership co-operates with it before it sends a notice of penalty assessment to the relevant partners, but cannot reduce the rate to less than 4%.

“We can reduce the penalty percentage rate if the partnership co-operates with us before we send a notice of penalty assessment to the relevant partners. … We cannot reduce the penalty percentage rate to less than 4%.”

HMRC's factsheet CC/FS25b says that if the relevant partners are charged a penalty and disagree, only the representative partner can appeal, and that they cannot appeal on the grounds that a partner disagrees with how their share of the penalty has been calculated.

“If we charge the relevant partners a penalty and the partners disagree, only the representative partner can appeal. … However, they cannot appeal on the grounds that one or more of the partners disagrees with how their share of the penalty has been calculated.”

HMRC's factsheet CC/FS25b says payment of a partner payment notice is due 90 calendar days after the relevant partner receives it. It also says that if both a partnership follower notice and partner payment notices are sent, each relevant partner is to pay the accelerated partner payment whether or not the partnership decides to take corrective action.

“Payment will be due 90 calendar days after the date the relevant partner receives the partner payment notice. … each relevant partner should pay the accelerated partner payment whether or not the partnership decides to take corrective action.”

HMRC's factsheet CC/FS25b says that if any relevant partner thinks they may have problems paying, it asks to be told straightaway, and that you can ask someone else to deal with HMRC on your behalf, for example a professional adviser, friend or relative.

“If any relevant partner thinks they may have problems paying, they should tell us straightaway. … You can also ask someone else to deal with us on your behalf, for example, a professional adviser, friend or relative.”

HMRC's factsheet CC/FS26 says HMRC gives it to people it says have used a scheme to avoid tax and/or National Insurance contributions (NICs), and that HMRC will soon ask them to pay the amount that relates to their use of the scheme, which it calls an accelerated payment.

“We’ve given you this factsheet because you’ve used a scheme to avoid tax and/or National Insurance contributions (NICs). We’ll soon ask you to make a payment of the amount that relates to your use of the scheme. … Such a payment is known as an accelerated payment.”

HMRC's factsheet CC/FS26 says HMRC may issue an accelerated payment notice to a person who has used an avoidance scheme if certain conditions are met, and lists as one of them a current compliance check into their return or claim, or an open appeal against a tax assessment, determination or NICs decision.

“We may issue an accelerated payment notice to a person who has used an avoidance scheme if certain conditions are met. … Condition A – there’s … a current compliance check, referred to as an ‘enquiry’, into their return or claim … an open appeal against a tax assessment, a determination, or a decision about NICs liability”

HMRC's factsheet CC/FS26 says another condition (Condition C) is that one or more of the following applies: HMRC has given the person a follower notice, the person has used arrangements disclosable under DOTAS, or the person is subject to a GAAR counteraction notice.

“Condition C – one or more of the following applies … we’ve given the person a follower notice (this is explained in factsheet CC/FS27) … the person has used arrangements that are disclosable under the Disclosure of Tax Avoidance Schemes (DOTAS) legislation … the person is subject to a counteraction notice under the General Anti-Abuse Rule (GAAR)”

HMRC's factsheet CC/FS26 says the accelerated payment notice will tell you how much you need to pay and when, will tell you what you can do if you disagree with it, and that HMRC will tell you how it calculated the amount.

“We’ll send you an accelerated payment notice which will tell you how much you need to pay and when. … It’ll also tell you what you can do if you disagree with it. When we send the notice, we’ll tell you how we’ve calculated the amount you need to pay.”

HMRC's factsheet CC/FS26 says payment will be due 90 days after the date you receive the accelerated payment notice, and that making representations objecting to the notice may change the date the payment is due.

“Payment will be due 90 days after the date you receive the accelerated payment notice. … If you make representations objecting to the accelerated payment notice, the date the payment is due may change.”

HMRC's factsheet CC/FS26 says there is no right of appeal against an accelerated payment notice, but you can make representations to HMRC if you believe the conditions for issuing it have not been met or the amount shown is not correct.

“There’s no right of appeal against an accelerated payment notice. However, you can make representations to us if you believe that one or both of the following applies: … the conditions for issuing the notice have not been met … the amount shown in the notice is not correct”

HMRC's factsheet CC/FS26 says representations must be in writing and sent no later than 90 calendar days from the date you receive the notice, and that you cannot make representations once the 90 calendar days has passed.

“Your representations must be in writing, and you must make sure that you send your letter no later than 90 calendar days from the date that you receive the notice. … You cannot make representations once the 90 calendar days has passed.”

HMRC's factsheet CC/FS26 says that if you make representations before the payment due date and HMRC does not withdraw the notice, the deadline for paying may be extended, to the later of the due date in the notice and 30 days after you receive HMRC's decision on your representations.

“if you make representations before the date the payment is due, and we do not withdraw the notice, the deadline for paying may be extended. … Payment will be due on the later of: … the due date shown in the accelerated payment notice … 30 days after the date on which you receive our decision about the representations you made”

HMRC's factsheet CC/FS26 says that where there is a current compliance check or relevant contributions dispute and the full amount in the notice is not paid by the due date, you will be liable to a penalty equal to 5% of the amount you still owe, payable as well as the accelerated payment.

“If there’s a current compliance check or relevant contributions dispute and you do not pay the full amount shown in your accelerated payment notice by the date it’s due, you’ll be liable to pay a penalty. … the date it’s due, you’ll be liable to pay a penalty equal to 5% of the amount you still owe”

HMRC's factsheet CC/FS26 says that if payment is still not made in full within 5 months of the due date, a further penalty of 5% of the amount still owed applies, and another 5% if it is not paid within 11 months, as well as the earlier penalties.

“If your payment is not made in full on or before: … 5 months of the date it’s due, you’ll be liable to pay a penalty equal to 5% of the amount you still owe … 11 months of the date it’s due, you’ll be liable to pay a penalty equal to 5% of the amount you still owe … this is as well as the 2 previous 5% penalties”

HMRC's factsheet CC/FS26 says that if you think you may have problems paying, it asks to be told straightaway, and that if you have health or personal circumstances that make it difficult to deal with HMRC you can let HMRC know, and it will help in whatever way it can.

“If you think you may have problems paying, tell us straightaway. … please let us know. We’ll help you in whatever way we can.”

HMRC's factsheet CC/FS27 says HMRC gives it to people it says have used a scheme to avoid paying Income Tax or National Insurance contributions (NICs) through PAYE, or both, and that HMRC will soon write to tell them about taking corrective action to avoid a penalty and about making a payment relating to their use of the scheme.

“We’ve given you this factsheet because you’ve used a scheme to avoid paying Income Tax through PAYE, or National Insurance contributions (NICs) through PAYE, or both, and we’ll soon write to tell you about: … taking corrective action to avoid a penalty … making a payment of the amount that relates to your use of the scheme”

HMRC's factsheet CC/FS27 says a follower notice tells the follower they will be liable to a penalty if they do not settle their dispute with HMRC, and that the penalty for not taking corrective action on time is equal to 50% of the tax or NICs in dispute.

“A follower notice tells the follower that they’ll be liable to pay a penalty if they do not settle their dispute with us. The amount of the penalty for not taking corrective action on time is equal to 50% of the tax or NICs in dispute”

HMRC's factsheet CC/FS27 says that if a court or tribunal has made a final ruling that an avoidance scheme does not achieve the tax or NICs advantage, HMRC may send a follower notice to followers if certain conditions are met, including a current compliance check into their return or claim, or an open appeal.

“If a court or tribunal has made a final ruling that an avoidance scheme does not achieve the tax or NICs advantage, we may send a follower notice to the followers if certain conditions are met. … a current compliance check, referred to in the legislation as a ‘tax enquiry’, into their return or claim … an open appeal against a tax assessment, a determination, or a decision about NICs liability”

HMRC's factsheet CC/FS27 says that where there is a dispute about whether NICs are due in relation to an avoidance scheme, HMRC can send follower notices and accelerated payment notices before an appealable NICs decision has been made, using what the legislation calls a relevant contributions dispute.

“As there’s no direct equivalent of an enquiry for NICs, paragraph 6 of Schedule 2 to the National Insurance Contributions Act 2015 introduces the concept of a ‘relevant contributions dispute’. This means that, where there’s a dispute about whether NICs are due in relation to an avoidance scheme, we can send follower notices and accelerated payment notices before an appealable NICs decision has been made.”

HMRC's factsheet CC/FS27 says a follower notice will tell you how to take corrective action and when, and what to do if you disagree. It lists the corrective action as whichever is relevant of amending your return or claim, settling your appeal, or entering into a written agreement with HMRC.

“we’ll send you a follower notice, which will tell you how to take corrective action and when. The notice will also tell you what to do if you disagree with it. … This will mean taking whichever of the following actions is relevant: … amending your return or claim … settling your appeal … entering into a written agreement with HMRC”

HMRC's factsheet CC/FS27 says there is no right of appeal against a follower notice, but you can make representations to HMRC if you believe, for example, that the court or tribunal ruling specified in the notice is not relevant to the scheme you used, or that you received the notice after the deadline for sending it.

“There’s no right of appeal against a follower notice. However, you can make representations to us if you believe that one or more of the following applies: … the final court or tribunal ruling specified in the notice is not relevant to the avoidance scheme that you used … you received the notice after the deadline for us sending it to you”

HMRC's factsheet CC/FS27 says representations about a follower notice must be in writing and sent no later than 90 calendar days from the date you receive the notice, and that making representations may change the date by which corrective action has to be taken.

“Your representations must be in writing, and you must make sure that you send your letter no later than 90 calendar days from the date you receive the follower notice. … If you make representations objecting to the follower notice, the date by which you need to take the corrective action may change.”

HMRC's factsheet CC/FS27 says that if you decide not to take corrective action on time you will be liable to a penalty, unless HMRC or the tribunal agree it was reasonable in the circumstances not to have taken corrective action.

“If you decide not to take corrective action on time, you’ll be liable to pay a penalty … unless we or the tribunal agree that it was reasonable in the circumstances for you not to have taken corrective action”

HMRC's factsheet CC/FS27 says HMRC can reduce the penalty percentage rate if you have co-operated with it before it sends a notice of penalty assessment, and that the rate it charges can never be less than 10%.

“We can reduce the penalty percentage rate if you’ve co-operated with us before we send a notice of penalty assessment. … The penalty percentage rate that we charge can never be less than 10%.”

HMRC's factsheet CC/FS27 says you can appeal against the amount of a penalty for not taking corrective action, and can also appeal if, for example, you believe the ruling in the follower notice is not relevant to the scheme you used or that it was reasonable in all the circumstances not to have taken the corrective action.

“You can appeal against the amount of the penalty. You can also appeal if you believe that one or more of the following applies: … the final court or tribunal ruling specified in the follower notice is not relevant to the avoidance scheme that you used … it was reasonable, in all the circumstances, for you not to have taken the necessary corrective action”

HMRC's factsheet CC/FS27 says payment of an accelerated payment notice will be due 90 days after you receive it. It also says that if a follower notice is sent as well, the accelerated payment is to be paid whether or not you will take corrective action.

“Payment will be due 90 days after the date you receive the accelerated payment notice. … If we send you a follower notice as well as an accelerated payment notice, you should pay the accelerated payment whether or not you’re going to take corrective action.”

HMRC's factsheet CC/FS27 says that if you think you may have problems paying, it asks to be told straightaway, and that if you have health or personal circumstances that make it difficult to deal with HMRC you can let HMRC know and it will help in whatever way it can.

“If you think you may have problems paying, tell us straightaway. … please let us know. We’ll help you in whatever way we can.”

HMRC's factsheet CC/FS28 says HMRC gives it to people it says have used a tax avoidance scheme, and that HMRC will soon ask them to make a payment, take action on the amount relating to their use of the scheme, or both.

“We’ve given you this factsheet because you’ve used a tax avoidance scheme, and we’ll soon ask you to do one or both of the following: … make a payment of the amount that relates to your use of the scheme … take action on the amount that relates to your use of the scheme”

HMRC's factsheet CC/FS28 says HMRC may send an accelerated payment notice to a person who has used an avoidance scheme if there is a current compliance check into their return or claim or an open appeal (Condition A), and the return, claim or appeal is made on the basis of a tax advantage from the scheme (Condition B).

“We may send an accelerated payment notice to a person who has used an avoidance scheme if: … there’s a current compliance check into their return or claim, (or for partnerships, into the partnership return or claim) or there’s an open appeal (Condition A) … the return, or claim, or the appeal is made on the basis that there’s a tax advantage from the avoidance scheme used (Condition B)”

HMRC's factsheet CC/FS28 says that, in addition, one or more further conditions (Condition C) must apply, such as that HMRC has given the person a follower notice, or the person has used arrangements that are disclosable under the DOTAS legislation.

“and one or more of the following applies (Condition C) … we’ve given the person (or the nominated partner) a follower notice … the person (or the partnership) has used arrangements that are disclosable under the disclosure of tax avoidance schemes (DOTAS) legislation”

HMRC's factsheet CC/FS28 says the accelerated payment notice will tell you how much you need to pay, and what action is needed if the tax advantage includes an asserted surrenderable amount. It says the notice will also tell you what you can do if you disagree with it.

“We’ll send you an accelerated payment notice which will tell you how much you need to pay. If the understated or disputed tax advantage includes, or is all of an asserted surrenderable amount, we’ll tell you what action needs to be taken. The notice will also tell you what you can do if you disagree with it.”

HMRC's factsheet CC/FS28 says that where an amount has already been surrendered as group relief, the notice will require the company to withdraw surrender of a specified amount, so the claimant companies must amend their returns.

“If any of the disputed loss or amount has already been surrendered as group relief, the accelerated payment notice will require the company to withdraw surrender of a specified amount. The result of this is that the claimant company or companies must amend their returns to reflect the new situation.”

HMRC's factsheet CC/FS28 says that if no representations have been made, you are required to make the payment and withdraw the consent to surrender the specified group relief amount no later than 90 calendar days from the date you receive the notice.

“If no representations have been made, you are required to take the following actions no later than … 90 calendar days from the date that you receive the notice: … make payment of the amount specified … withdraw the consent to surrender the specified amount of the group relief”

HMRC's factsheet CC/FS28 says there is no right of appeal against an accelerated payment notice, but you can make representations to HMRC if you believe the conditions for issuing it have not been met or the amount shown is not correct.

“There is no right of appeal against an accelerated payment notice. However, you can make representations to us if you believe that one or both of the following applies: … the conditions for issuing the notice have not been met … the amount shown in the notice is not correct”

HMRC's factsheet CC/FS28 says representations must be in writing and sent no later than 90 calendar days from the date you receive the notice, and that you cannot make representations once the 90 calendar days has passed.

“Your representations must be in writing, and you must make sure that you send your letter no later than 90 calendar days from the date that you receive the notice. … You cannot make representations once the 90 calendar days has passed.”

HMRC's factsheet CC/FS28 says that if you make representations before the due date and HMRC does not withdraw the notice, the deadline for paying or taking action may be extended, to the later of the due date in the notice and 30 days after you receive HMRC's decision.

“if you make representations before the date the payment is due and/or action needs to be taken, and we do not withdraw the notice, the deadline for paying/taking action may be extended. … the due date shown in the accelerated payment notice … 30 days after the date on which you receive our decision about the representations you made”

HMRC's factsheet CC/FS28 says that where there is a current compliance check and the full amount in the notice is not paid by the due date, you will be liable to a penalty equal to 5% of the amount you still owe, payable as well as the accelerated payment.

“If there’s a current compliance check and you do not pay the full amount shown in your accelerated payment notice by the date it is due, you’ll be liable to a penalty. … the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe”

HMRC's factsheet CC/FS28 says that if payment is still not made in full within 5 months of the due date, a further penalty of 5% of the amount still owed applies, and another 5% if it is not paid within 11 months, as well as the earlier penalties.

“If your payment is not made in full on or before: … 5 months of the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe … 11 months of the date it’s due, you’ll be liable to a penalty equal to 5% of the amount you still owe … this is as well as the 2 previous 5% penalties”

HMRC's factsheet CC/FS28 says that if you think you may have problems paying, it asks to be told straightaway, and that if you have health or personal circumstances that make it difficult to deal with HMRC you can let HMRC know and it will help in whatever way it can.

“If you think you may have problems paying, tell us straightaway. … please let us know. We’ll help you in whatever way we can.”

HMRC's factsheet CC/FS30a says it contains information about the penalty HMRC will charge if it has sent you a follower notice and you have not taken the necessary corrective action on time.

“This factsheet contains information about the penalty we’ll charge you if we’ve sent you a follower notice and you’ve not taken the necessary corrective action on time.”

HMRC's factsheet CC/FS30a says HMRC will charge a penalty if it has sent you a follower notice and you have not taken corrective action on time, and that the follower notice explains what corrective action you need to take.

“We’ll charge you a penalty if we’ve sent you a follower notice, and you have not taken corrective action on time. The follower notice explains what corrective action you need to take.”

HMRC's factsheet CC/FS30a says it is for non-partnership cases where the tax avoidance scheme is for one of the taxes or NICs it lists, and for partnership cases where the scheme is for Stamp Duty Land Tax or Annual Tax on Enveloped Dwellings.

“This factsheet is for: … non-partnership cases where the tax avoidance scheme is for any of the taxes or NICs listed in ‘The taxes and NICs to which these penalty rules apply’ section … partnership cases where the tax avoidance scheme is for Stamp Duty Land Tax or Annual Tax on Enveloped Dwellings”

HMRC's factsheet CC/FS30a says the penalty for not taking corrective action is equal to 30% of the value of the denied advantage, though HMRC can reduce the penalty percentage rate if you have co-operated with it.

“The penalty for not taking corrective action is equal to 30% of the value of the denied advantage. However, we can reduce the penalty percentage rate if you’ve co-operated with us.”

HMRC's factsheet CC/FS30a says that once HMRC has decided the penalty amount it will send a notice of penalty assessment, that it will normally first write to explain how it worked out the amount, and that you can appeal when you receive the notice if you disagree with it.

“When we’ve decided the amount of the penalty that we’re going to charge, we’ll send you a notice of penalty assessment. … Before we send a notice of penalty assessment, we’ll normally write to tell you how we’ve worked out the amount of the penalty. … When you receive the notice of penalty assessment, you’ll be able to appeal if you disagree with it.”

HMRC's factsheet CC/FS30a says there is a deadline for HMRC to send the notice of penalty assessment. Where the follower notice relates to a compliance check or relevant contributions dispute, the latest day is 90 days from the date the check is completed or the dispute is settled.

“There’s a deadline for us sending the notice of penalty assessment to you. If the follower notice relates to a compliance check or relevant contributions dispute, the latest day on which we can send you a notice of penalty assessment is 90 days from the date on which the compliance check is completed or relevant contributions dispute is settled.”

HMRC's factsheet CC/FS30a says HMRC can reduce the penalty percentage rate if you have co-operated with it before it sends the notice of penalty assessment, but cannot reduce the rate to less than 10%.

“We can reduce the penalty percentage rate if you’ve co-operated with us before we send you the notice of penalty assessment. … We cannot reduce the penalty percentage rate to less than 10%.”

HMRC's factsheet CC/FS30a says the penalty range runs from a maximum of 30 to a minimum of 10, a range of 20, which HMRC can reduce by up to 100% for the quality of co-operation, but the rate it charges can never be less than 10%.

“The maximum is 30 and the minimum is 10, which gives us a penalty range of 20. … We can reduce the penalty range of 20 by anything up to 100% for the quality of co-operation. However, the penalty percentage rate that we charge can never be less than 10%”

HMRC's factsheet CC/FS30a says that for counteracting the denied advantage, its guide table shows a reduction to the penalty range of up to 70% in an appeal case and up to 50% in a compliance check case.

“Reduction to the penalty range if the follower notice relates to an appeal case | Reduction to the penalty range if the follower notice relates to a compliance check case … Counteracting the denied advantage (this will be described as ‘relinquishing’ the denied advantage if your follower notice relates to an appeal) … | Up to 70% | Up to 50% |”

HMRC's factsheet CC/FS30a says that if HMRC charges a penalty for not taking corrective action you can appeal against the amount of the penalty, and can also appeal if, for example, you believe the court or tribunal ruling in the follower notice is not relevant to the scheme you used, or that it was reasonable in all the circumstances not to have taken the corrective action.

“You can appeal against the amount of the penalty. You can also appeal against the penalty if you believe that one or more of the following applies: … the final court or tribunal ruling specified in the follower notice is not relevant to the tax avoidance scheme that you used … it was reasonable, in all the circumstances, for you to have not taken the necessary corrective action”

HMRC's factsheet CC/FS30a says an appeal must be in writing and reach HMRC within 30 days of the date you receive the notice of penalty assessment.

“If you appeal you must do so in writing. You must make sure that your appeal reaches us within 30 days of the date that you receive the notice of penalty assessment.”

HMRC's factsheet CC/FS30a says you can apply for publicly funded legal assistance or Legal Aid, and that if there is anything you do not understand about your rights you can tell the officer who gave you the factsheet.

“You can apply for publicly funded legal assistance or Legal Aid. … If there’s anything you do not understand about these rights or what they mean for you, please tell the officer who gave you this factsheet straightaway.”

HMRC's factsheet CC/FS30b says it gives information about the penalties HMRC will charge if it has sent a partnership follower notice to the representative partner and they have not taken the necessary corrective action on time.

“This factsheet gives information about the penalties we’ll charge if we’ve sent a partnership follower notice to the representative partner and they’ve not taken the necessary corrective action on time.”

HMRC's factsheet CC/FS30b says that if HMRC has sent a partnership follower notice to the representative partner and they have not taken corrective action on time, HMRC will charge each of the relevant partners a penalty.

“If we’ve sent a partnership follower notice to the representative partner and they have not taken corrective action on time, we’ll charge each of the relevant partners a penalty. The partnership follower notice explains what corrective action the representative partner needs to take.”

HMRC's factsheet CC/FS30b says the total penalties are equal to 12% of the value of the denied advantage, with each relevant partner liable to their appropriate share, and that HMRC can reduce the penalty percentage rate if the partnership has co-operated with it.

“The total amount of the penalties for not taking corrective action is equal to 12% of the value of the denied advantage, and each relevant partner will be liable to their appropriate share of that total amount. … We can reduce the penalty percentage rate if the partnership has co-operated with us.”

HMRC's factsheet CC/FS30b says HMRC will send a notice of penalty assessment to each relevant partner once it has decided the amount, and that the representative partner can appeal if any of the partners disagree with their notice.

“When we’ve decided the amount of the penalties that we’re going to charge, we’ll send a notice of penalty assessment to each relevant partner. … When we’ve given each relevant partner their notice of penalty assessment, the representative partner can appeal if any of the partners disagree with their notice.”

HMRC's factsheet CC/FS30b says there is a deadline for HMRC to send the notices of penalty assessment. Where the partnership follower notice relates to a compliance check, the latest day is 90 days from the date the compliance check is completed.

“There is a deadline for us sending the notices of penalty assessment to the relevant partners. … If the partnership follower notice relates to a compliance check, the latest day on which we can send a notice of penalty assessment is 90 days from the date on which the compliance check is completed.”

HMRC's factsheet CC/FS30b says HMRC can reduce the penalty percentage rate if the partnership has co-operated with it before HMRC sends the notices of penalty assessment, but cannot reduce the rate to less than 4%.

“We can reduce the penalty percentage rate if the partnership has co-operated with us before we send notices of penalty assessment to the relevant partners. … We cannot reduce the penalty percentage to less than 4%.”

HMRC's factsheet CC/FS30b says the penalty range runs from a maximum of 12 to a minimum of 4, a range of 8, which HMRC can reduce by up to 100% for the quality of co-operation, but the rate it charges can never be less than 4%.

“The maximum is 12 and the minimum is 4, which gives us a penalty range of 8. … We can reduce the penalty range of 8 by anything up to 100% for the quality of co-operation. However, the penalty percentage rate that we charge can never be less than 4%, even if we reduce the penalty range by 100%.”

HMRC's factsheet CC/FS30b says that for counteracting the denied advantage, its guide table shows a reduction to the penalty range of up to 70% in an appeal case and up to 50% in a compliance check case.

“Reduction to the penalty range if the follower notice relates to an appeal case | Reduction to the penalty range if the follower notice relates to a compliance check case … Counteracting the denied advantage (this will be described as relinquishing the denied advantage if your follower notice relates to an appeal) … | Up to 70% | Up to 50% |”

HMRC's factsheet CC/FS30b says that to work out the total penalties HMRC multiplies the value of the denied advantage by the penalty percentage rate, and each relevant partner is liable to their appropriate share of the total.

“To work out the total amount of the penalties, we multiply the value of the denied advantage by the penalty percentage rate. Each relevant partner will be liable to their appropriate share of the total amount of penalties.”

HMRC's factsheet CC/FS30b says that if penalties are charged only the representative partner can appeal if any relevant partner disagrees, and that they can appeal against the total amount of the penalties the relevant partners have to pay.

“If we charge the relevant partners a penalty because the representative partner did not take corrective action, only the representative partner will be able to appeal if any of the relevant partners disagree. … The representative partner can appeal against the total amount of the penalties the relevant partners have to pay.”

HMRC's factsheet CC/FS30b says an appeal by the representative partner must be in writing and reach HMRC within 30 days of the date the relevant partners receive their notice of penalty assessment, and that they cannot appeal on the grounds that a partner disagrees with how their share was calculated.

“If the representative partner appeals, they must do so in writing. They must make sure that the appeal reaches us within 30 days of the date that the relevant partners receive their notice of penalty assessment. … However, the representative partner cannot appeal on the grounds that one or more of the partners disagrees with how their share of the penalty has been calculated.”

HMRC's factsheet CC/FS30b says you have the right to apply for publicly funded legal assistance or Legal Aid, and that if there is anything you do not understand about your rights you can tell the officer who gave you the factsheet.

“You have the right to apply for publicly funded legal assistance or Legal Aid. … If there is anything you do not understand about these rights or what they mean for you, please tell the officer who gave you this factsheet straightaway.”