No penalties for ‘innocent’ tax errors, says HMRC boss

HM Revenue and Customs boss Jim Harra was due to speak today to the public accounts committee on the subject of managing tax compliance following the pandemic, however questioning in the early part of the session focussed on the tax affairs of the under-fire Nadhim Zahawi.

Liberal Democrat MP Sarah Olney asked the HMRC boss, “what does HMRC understand when it uses the word ‘carelessness’ – that someone has been careless with their tax return?”

Mr Harra responded: “There are no penalties for innocent errors in your tax affairs. So if you take reasonable care but nevertheless make a mistake whilst you will be liable for the for the tax and for interest if it’s paid late, you would not be liable for a penalty. But if your error was as a result of carelessness, then legislation says that a penalty could apply in those circumstances”.