VCP10775 | Misdeclaration penalty: Discretion, reasonable excuse, and mitigation: Self-billing

Please note: VAT Misdeclaration Penalty has been replaced by the Schedule 24 inaccuracy penalty for all accounting periods where the return period commences on or after 01/04/2008 and the due date is on or after 01/04/2009. Misdeclaration penalty will still apply where the due date is before 01/04/2009.

Please see the Compliance Handbook CH80000 Penalties for Inaccuracies for further details.

The following questions should be addressed when considering reasonable excuse

• Has the supplier relied on the customer to establish the correct liability of the supply?

• Has the supplier agreed to self-billing and does the supplier appear on the customer’s list of suppliers agreeing to use self-billing?

• Irrespective of the first point under this heading, is it reasonable to expect the supplier to be fully aware of the correct liability i.e. are they a major company experienced in this type of supply?