Penalties for failures on country-by-country reporting capped at £3k

HMRC has issued guidance setting out the penalty regime for companies failing to follow country-by-country reporting rules

The maximum penalty is £3,000 for an inaccuracy in a country-by-country report, or in additional information which HMRC has asked for. This is for each report that an inaccuracy relates to.

There is an initial £300 penalty for not meeting an obligation and this may be charged for each failure made. This means there can be multiple failures in a reporting period where penalties can be charged.

In the event that a company does not submit a completed country by country report, HMRC can charge daily penalties of £60 although this is capped at £3,000.

When assessing the amount of a penalty, HMRC considers:

•            the number of error types;

•            whether there is a material error;

•            whether more than one jurisdiction is affected;

•            whether the company has previously sent HMRC an inaccurate country by country report;

•            whether the company has previously sent inaccurate supplementary information in relation to a country-by-country report; and

•            whether the company disclosed the error to HMRC.

HMRC will initially contact the reporting company to alert them about a possible error or missing report, advising them of a penalty risk for non-compliance.

Additionally, there is a 30-day penalty appeal period.

These penalties include penalties for inaccurate information and penalties for not meeting obligations under The Taxes (Base Erosion and Profit Shifting) (Country-by-Country reporting) Regulations 2016.

Average: 4 (1 vote)

Rate this article

Related Articles