Taxes Management Act 1970 section 97A

Two or more tax-geared penalties in respect of same tax

Section 97A limits the total amount payable where a person incurs two or more tax-geared penalties calculated by reference to the same income tax or capital gains tax for a year of assessment.

• Where multiple penalties are each calculated by reference to the same tax liability, the total is capped at the level of the single greatest penalty
• Each penalty after the first is reduced so that the aggregate does not exceed the greatest individual penalty, so far as it relates to any particular part of the tax
• The rule applies to income tax and capital gains tax for a given year of assessment
• The cap operates on a tax-by-tax and portion-by-portion basis, preventing the stacking of penalties on the same underlying liability