Revenue and Customs Brief 19/08 provides details on new legislation on the charging of penalties in relation to returns and other documents. The new legislation is intended to “help those who try to comply, and come down hard on those who don't.”

In summary,

• if taxpayers take reasonable care when completing their returns they will not be penalised
• if they do not take reasonable care, errors will be penalised and the penalties will be higher if the error is deliberate

In addition, disclosing errors to HMRC early will substantially reduce any penalty due.

The new penalties are for errors on returns and documents initially for VAT, PAYE, National Insurance, Capital Gains Tax, Income Tax, Corporation Tax and the Construction Industry Scheme. For these taxes, it applies to returns or other documents for tax periods starting on or after 1 April 2008 that are due to be filed on or after 1 April 2009.

Revenue and Customs Brief 19/08 is reproduced at Section 2.03.