Penalties for failure to comply

9 (1) If the Department considers that a person who has been given an account information notice has failed to comply with it, the Department must give the person an opportunity to make representations about the failure.

(2) Sub-paragraph (3) applies if, having considered any representations that are made, the Department has reasonable grounds to believe that the person has failed to comply with the account information notice and had no reasonable excuse for the failure.

(3) The Department may give the person—

(a) a notice requiring the person to pay a penalty of a prescribed amount (a “fixed penalty”);

(b) a notice requiring the person to pay a penalty calculated by reference to a daily rate (a “daily rate penalty”);

(c) a notice requiring the person to pay a fixed penalty and a daily rate penalty.

(4) A notice under sub-paragraph (3) is referred to in this Schedule as a penalty notice.

(5) A penalty notice imposing a fixed penalty must state—

(a) the amount of the penalty, and

(b) the period within which it must be paid.

(6) A penalty notice imposing a daily rate penalty must—

(a) state the daily rate of the penalty,

(b) state the date from which the penalty will begin to be payable, which must not be earlier than the day after the last date on which an appeal against the penalty may be brought under paragraph 14, and

(c) state that the penalty will continue to be payable at the daily rate until the date on which the person complies with the account information notice or such earlier date as may be specified.

(7) A penalty notice must also include information as to—

(a) the failure to which the penalty relates,

(b) how payment may be made,

(c) rights of appeal, and

(d) the consequences of non-payment (including, in the case of a daily rate penalty, the potential for the penalty to be increased as described in paragraph 10).

(8) The Department may vary or cancel a penalty notice by notice to the person to whom it was given.

(9) The maximum amount of a fixed penalty that may be prescribed is £1,000.

(10) Subject to paragraph 10, the daily rate of a daily rate penalty is to be such rate as the Department considers appropriate but it must not exceed £40.

Increased daily rate penalties

10 (1) This paragraph applies if—

(a) a daily rate penalty is imposed on a person by a penalty notice, and

(b) the failure to which the penalty relates continues for more than 30 days beginning with the first date on which the daily rate penalty is payable.

(2) The Department may make an application to the Tribunal for an increased daily rate penalty to be payable by the person.

(3) The Tribunal may determine that an increased daily rate penalty should be payable, and in that case, must determine the increased daily rate and the date from which the increased penalty will begin to be payable.

(4) In deciding the increased daily rate, the Tribunal must, in particular, have regard to—

(a) the likely cost to the person of not complying with the account information notice,

(b) any benefits to the person of not complying with it, and

(c) any benefits to anyone else resulting from the person’s non-compliance.

(5) The Tribunal may not determine a daily rate that exceeds £1,000.

(6) The Department must notify the person of the Tribunal’s determination.

Recovery of penalties

11 A penalty imposed by a penalty notice is recoverable—

(a) if a county court so orders, as if it were payable under an order of that court;

(b) if the High Court so orders, as if it were payable under an order of that Court.

Power to change maximum amount of penalties

12 Regulations may amend the amount for the time being specified in paragraph 9(9) or (10) or 10(5) to reflect a change in the value of money.