What is reasonable care

Source: HM Revenue & Customs | | 27/12/2019

The inaccuracy penalty system is intended to make penalties simpler to understand and more consistent across many taxes. HMRC has the power to significantly reduce the amount of penalties due. The largest reductions are for unprompted disclosures (as against prompted disclosures). The penalties also vary depending on the taxpayers’ behaviour. HMRC has 4 levels of behaviour ranging from taking reasonable care in dealing with errors to careless, deliberate or deliberate and concealed behaviour patterns.

There is no definition of taking reasonable care from a taxation standpoint. However, HMRC’s commentary in this area is helpful. HMRC accepts that 'reasonable care' cannot be identified without consideration of the particular person’s abilities and circumstances. HMRC recognises the wide range of abilities and circumstances of those persons completing returns or claims and accepts that what is necessary for each person to discharge that responsibility has to be viewed in the light of that person’s abilities and circumstances.

HMRC gives the example of not expecting the same level of knowledge or expertise from a self-employed, un-represented individual as we do from a large multinational company.



 

Latest News

Breathing space to help those in debt
11/02/2020 - More...
HM Treasury has confirmed that the new 'breathing space' scheme to help those with problem debts will become operational next year. The scheme will provide legal

Scottish Income Tax rates announced 2020-21
11/02/2020 - More...
Public finance minister Kate Forbes delivered her first Budget statement to the Scottish Parliament on 6 February 2020. This followed the shock resignation of finance minister,

Search


Newsletter

With our newsletter, you automatically receive our latest news by e-mail and get access to the archive including advanced search options!

» Sign up for the Newsletter
» Login