DoTAS penalties toothless against older firms

If you're an old firm with no novel tax planning peddled you're fine

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Old firms are now low risk therefore compared to new firms re potential nasty (and retrospective) DoTAS penalties (effectively a kind of grandfathering). See:

https://financeandtax.decisions.tribunals.gov.uk/judgmentfiles/j12234/TC...

And it's another HMRC c*ck-up of course. The nasty retrospective effect effectively backfired in this case to protect the firm re the penalty issue time limits.

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By Justin Bryant
08th Oct 2021 11:53

In this example, the firm is now incentivised not to disclose, especially if HMRC are not aware of the potential DoTAS issue, since the 6 year time limit is then likely to come to their rescue in due course:

https://www.gov.uk/guidance/joint-and-several-liability-notices-and-pena...

See also Example 2, Situation C here: https://www.gov.uk/guidance/overview-of-joint-and-several-liability-noti...

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By Justin Bryant
22nd Dec 2022 09:48

Now confirmed by UT. Taxpayer didn't bother turning up and HMRC argued my above incentives point. The decision looks 100% correct to me. HMRC won't be happy and you can now expect a law change, as they are always very bad losers.

https://www.bailii.org/uk/cases/UKUT/TCC/2022/353.html

Also, interesting UT comments at para 59 on the principle against doubtful penalisation.

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By Justin Bryant
23rd Feb 2024 13:32

This promoter made a schoolboy error/oversight re this time limit that cost it £900k: https://financeandtax.decisions.tribunals.gov.uk/judgmentfiles/j12974/TC...

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