Value Added Tax Act 1994 section 69

Breaches of regulatory provisions

Section 69 sets out the penalties that apply when a person fails to comply with various regulatory requirements under the VAT system, including obligations relating to registration, record-keeping, returns, payment of VAT, and other administrative duties.

• Failure to comply with VAT regulatory requirements attracts a daily penalty at a prescribed rate (£5, £10 or £15 depending on compliance history) multiplied by each day of default up to 100 days, or £50 if greater — with a separate £500 penalty for failing to preserve records
• Where the failure relates to late VAT returns or late payment, the daily rate may be increased to a percentage of the VAT due (one-sixth, one-third or one-half of 1 per cent) if that produces a higher figure than the standard prescribed rate
• No penalty arises if the person can demonstrate a reasonable excuse, or if the same conduct has already resulted in a criminal conviction, a default surcharge, or a penalty under other specified provisions
• The Treasury may update the penalty amounts by order to reflect changes in the value of money, but any such change only applies to failures beginning on or after the date the order takes effect