As you may already know HMRC is “normalising” its Penalty Regime so that the “Revenue” and “Customs” will be singing from the same hymn sheet when deciding whether or not to seek a penalty in a particular case and in determining the amount of that penalty.
The new rules apply to Returns (P35, P11D(b) etc) for periods commencing on or after 1st April 2008 that are due to be submitted to HMRC on or after 1st April 2009.

The first Returns to fall under this new regime are :-

i) 2008/09 P35 - due to HMRC by 19th May 2009

2008/09 P35 Q.6 - “Are you a Service Company? etc”. Whilst the answer to this
question is straightforward, the supplementary question regarding the operation of
IR35 by the company may now have to be considered a bit more carefully than in
the past. Remember we are here to discuss / guide you in this intricate subject.

ii) 2008/09 P11D(b) - due to HMRC by 6th July 2009 (with forms P11D)

P11D - Beneficial Loan Benefits arising from a director’s etc overdrawn account is
another potential reason for the submission of an incorrect Return. In the past any
adjustment to this Benefit has been notified to HMRC following the completion of
the company’s accounts but the onus will now be on the company (i.e. you) to get
it right first time.

iii) Vat Returns –due to HMRC on or after 1st April 2009

For periods commencing on or after 1st April 2008

The “good news” is that HMRC will not seek a penalty if you take reasonable care to get it right but still make a mistake.

According to HMRC “reasonable care” includes :-

Keeping accurate records to make sure the Returns you submit are correct

Checking what the correct tax position is if you don’t fully understand something

Telling HMRC promptly of any error/mistake in a Return that you have already
submitted.

“Gordon’s black hole” seems to getting deeper with every passing day. Don’t help him to fill it. A little time and care could save the company (and you) a bit
of “hard earned cash”; it’s much better in “your” pocket than in his black hole !