IHTM36010 | Penalties: types of penalty
From HM Revenue & Customs · Inheritance Tax Manual
Penalties can be sought for various acts or omissions that might prevent the collection of tax properly due.
In general penalties arise because
an account is delivered late (),
there is a failure to deliver an account ((),
there is a failure to meet the requirements of where an instrument of variation made on or after 1 August 2002 results in additional tax (),
an account, information or document is incorrect (), or
there is a failure to correct an earlier error within a reasonable timescale (),
there is a failure to comply with a notice for information (IHTM32221), .
We may also seek penalties where there is a failure
to comply with a information notice (IHTM32231),
to make a return under /S.218 of names and addresses of both the settlor and trustees where a settlor is a long-term UK resident (after 6 April 2025) () or domiciled in the UK (before 6 April 2025) () and the trustees are not resident in the UK, IHTA/S245A(1)
The situations that give rise to the latter group of penalties are rarely seen and they are dealt with by Litigation.