Prospective
7U.K.After paragraph 8 insert—
“Amount of penalty: amounts in respect of periods of between 2 and 6 monthsU.K.
8A(1)Paragraphs 8B to 8E apply in the case of a payment of tax falling within any of items 6A,[6BA, 6BB,] 6C and 11A to 11M in the Table which relates to a period of less than 6 months but more than 2 months.
(2)But those paragraphs do not apply in the case of a payment mentioned in paragraph 3(1)(d).
(3)Paragraph 8K sets out how payments on account of VAT (item 6A) are to be treated for the purposes of paragraphs 8B to 8E.
8B(1)A penalty period begins to run on the penalty date for the payment of tax.
(2)The penalty period ends with the day 12 months after the date specified in or for the purposes of column 4 for the payment, unless it is extended under paragraph 8C(2)(c) or 8H(2)(c).
8C(1)This paragraph applies if—
(a)a penalty period has begun under paragraph 8B or 8G because P has failed to make a payment (“payment A”), and
(b)before the end of the period, P fails to make another payment (“payment B”) falling within the same item in the Table as payment A.
(2)In such a case—
(a)paragraph 8B(1) does not apply to the failure to make payment B,
(b)P is liable to a penalty under this paragraph for that failure, and
(c)the penalty period that has begun is extended so that it ends with the day 12 months after the date specified in or for the purposes of column 4 for payment B.
(3)The amount of the penalty under this paragraph is determined by reference to the number of defaults that P has made during the penalty period.
(4)If the default is P's first default during the penalty period, P is liable, at the time of the default, to a penalty of 2% of the amount of the default.
(5)If the default is P's second default during the penalty period, P is liable, at the time of the default, to a penalty of 3% of the amount of the default.
(6)If the default is P's third or a subsequent default during the penalty period, P is liable, at the time of the default, to a penalty of 4% of the amount of the default.
(7)For the purposes of this paragraph—
(a)P makes a default when P fails to pay an amount of tax in full on or before the date on which it becomes due and payable;
(b)in accordance with sub-paragraph (1)(b), the references in sub-paragraphs (3) to (6) to a default are references to a default in relation to the tax to which payments A and B relate;
(c)a default counts for the purposes of those sub-paragraphs if (but only if) the period to which the payment relates is less than 6 months;
(d)the amount of a default is the amount which P fails to pay.
(8)A penalty period may be extended more than once under sub-paragraph (2)(c).
8DIf any amount of the tax is unpaid after the end of the period of 6 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.
8EIf any amount of the tax is unpaid after the end of the period of 12 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.
Amount of penalty: amounts in respect of periods of 2 months or lessU.K.
8F(1)Paragraphs 8G to 8J apply in the case of a payment of tax falling within any of items 6A, 6C and 11A to 11M in the Table which relates to a period of 2 months or less.
(2)But those paragraphs do not apply in the case of a payment mentioned in paragraph 3(1)(d).
8G(1)A penalty period begins to run on the penalty date for the payment of tax.
(2)The penalty period ends with the day 12 months after the date specified in or for the purposes of column 4 for the payment, unless it is extended under paragraph 8C(2)(c) or 8H(2)(c).
8H(1)This paragraph applies if—
(a)a penalty period has begun under paragraph 8B or 8G because P has failed to make a payment (“payment A”), and
(b)before the end of the period, P fails to make another payment (“payment B”) falling within the same item in the Table as payment A.
(2)In such a case—
(a)paragraph 8G(1) does not apply to the failure to make payment B,
(b)P is liable to a penalty under this paragraph for that failure, and
(c)the penalty period that has begun is extended so that it ends with the day 12 months after the date specified in or for the purposes of column 4 for payment B.
(3)The amount of the penalty under this paragraph is determined by reference to the number of defaults that P has made during the penalty period.
(4)If the default is P's first, second or third default during the penalty period, P is liable, at the time of the default, to a penalty of 1% of the amount of the default.
(5)If the default is P's fourth, fifth or sixth default during the penalty period, P is liable, at the time of the default, to a penalty of 2% of the amount of the default.
(6)If the default is P's seventh, eighth or ninth default during the penalty period, P is liable, at the time of the default, to a penalty of 3% of the amount of the default.
(7)If the default is P's tenth or a subsequent default during the penalty period, P is liable, at the time of the default, to a penalty of 4% of the amount of the default.
(8)For the purposes of this paragraph—
(a)P makes a default when P fails to pay an amount of tax in full on or before the date on which it becomes due and payable;
(b)in accordance with sub-paragraph (1)(b), the references in sub-paragraphs (3) to (7) to a default are references to a default in relation to the tax to which payments A and B relate;
(c)a default counts for the purposes of those sub-paragraphs if (but only if) the period to which the payment relates is less than 6 months;
(d)the amount of a default is the amount which P fails to pay.
(9)A penalty period may be extended more than once under sub-paragraph (2)(c).
8IIf any amount of the tax is unpaid after the end of the period of 6 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.
8JIf any amount of the tax is unpaid after the end of the period of 12 months beginning with the penalty date, P is liable to a penalty of 5% of that amount.”