ECL31200 | Enforcement: Penalties: Failure to to deliver an ECL return

Where a person is liable to pay the Economic Crime Levy to HMRC, they must make a return to HMRC on or before 30 September after the end of the financial year for which the liability arises.

HMRC may impose a financial penalty on a person that is liable to make a return on or before the 30 September but does not do so.

HMRC may not impose a financial penalty where the person liable satisfies HMRC that they had a reasonable excuse for the failure. If that excuse has ceased, they continue to have a reasonable excuse if the failure is remedied without unreasonable delay after the excuse has ended.

While all customers who have registered for the ECL with HMRC are encouraged to submit a return, if the customer has no ECL liability they are not required to submit an ECL return (for example, this may be because they registered incorrectly with HMRC, or they did not meet the medium UK revenue threshold for a financial year).

Initial Penalty

The initial penalty on a person who has not delivered a return to HMRC by or on 30 September after the end of the financial year for which a liability arises is £250. HMRC may use information such as the ECL liabilities in previous years and available financial accounts to make a reasonable estimate as to whether a liability arises.

3 Months Penalty

If the person has not submitted an ECL return by the date which is 3 months after the due date, which is 1 January, the penalty amount is 5% of the amount of levy which HMRC considers due.

The 5% penalty is to be calculated by considering information such as the ECL liabilities in previous years and available financial accounts to make a reasonable estimate of what banding the customer will fall in.