CH96300 | Penalties for VAT and Excise Wrongdoing: How to process a penalty: When should you assess a penalty

From HM Revenue & Customs · Compliance Handbook

Normally you should issue the penalty assessment to the person when the VAT or excise wrongdoing that gave rise to the penalty is put right.

But a penalty assessment does not have to be made at the same time as the wrongdoing it relates to is put right. It may be made up to 12 months after

the end of the period during which a person can appeal against the amount due because of the wrongdoing, or
when a person has appealed against the amount due, the time when the appeal is finally decided or the person withdraws it, or
where there is no such assessment, the date on which the amount due because of the wrongdoing is ascertained.