Uncertainty over low number of taxpayer error penalties

Interesting trends in the number and type of penalties imposed by HMRC against taxpayers who understated income or gains were revealed earlier this year in figures obtained by RSM under the Freedom of Information Act.

They showed that the total (154 714) in 2017-18 had dropped by 11% on the previous year (172 869). At the time Mike Down head of tax risk and investigations suggested this was the result either of better compliance or more likely a shortage of HMRC resources to check and detect errors. See here.

One of the more curious statistics was the very low number of cases marked as inaccurate ‘errors’ in which no penalties were imposed – 876 in 2017-18. This was lower than in previous years and seemed to suggest that HMRC was increasingly reluctant to accept that people could make genuine mistakes.

However a...