Failing to meet your employer obligations: Shortfall penalties
Penalties for tax shortfalls
We charge shortfall penalties on top of any normal tax. The shortfall penalty is a percentage of the tax shortfall (deficit or understatement of tax), which results from certain actions by the employer. There are five types of penalties:
- lack of reasonable care (20%)
- unacceptable tax position (20%)
- gross carelessness (40%)
- abusive tax position (100%)
- evasion (150%).
The rate of shortfall penalty may be reduced for previous good behaviour.
In addition to these penalties you could be fined and/or imprisoned for up to five years.
Date published: 13 Feb 2007
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