Paragraph 31 I1
A person may appeal against a decision of HMRC—
that a penalty is payable under Part 3 F1or 4 of this Schedule, or
as to the amount of a penalty payable under Part 3 or 4 of this Schedule.
But sub-paragraph (1)(b) does not give a right of appeal against the amount of an increased daily penalty payable as a result of paragraph 23A (increased daily default penalty).
Notice of appeal must be given—
in writing to HMRC, and
before the end of the period of 30 days beginning with the day on which notification of the penalty was issued.
It must state the grounds of appeal.
On an appeal under sub-paragraph (1)(a) that is notified to the tribunal, the tribunal may confirm or cancel the decision.
On an appeal under sub-paragraph (1)(b) that is notified to the tribunal, the tribunal may—
confirm the decision, or
substitute for the decision another decision that HMRC had power to make.
If, in the case of an appeal against a penalty under Part 4, the tribunal substitutes its decision for HMRC's, the tribunal may rely on paragraph 27 (special reduction)—
to the same extent as HMRC (which may mean applying the same reduction as HMRC to a different starting point), or
to a different extent, but only if the tribunal thinks that HMRC's decision in respect of the application of that paragraph was flawed (when considered in the light of the principles applicable in proceedings for judicial review).
Subject to this paragraph and paragraph 32, the provisions of Part 5 of TMA 1970 relating to appeals have effect in relation to an appeal under this paragraph as they have effect in relation to an appeal against an assessment to income tax.
Annotations
Textual amendments
- F1
Words in Sch. 38 para. 31(1)(a) inserted (1.4.2026) by Finance Act 2026 (c. 11), s. 250(2), Sch. 22 para. 23(a)
- F2
Sch. 38 para. 31(1A) inserted (1.4.2026) by Finance Act 2026 (c. 11), s. 250(2), Sch. 22 para. 23(b)
Commencement
- I1
Sch. 38 para. 31 in force at 1.4.2013 by S.I. 2013/279, art. 2
Notes on Schedule 38
Textual amendments
- F1
Sch. 38 heading substituted (1.4.2026) by Finance Act 2026 (c. 11), s. 250(2), Sch. 22 para. 2
Modifications
- C1
Sch. 38 applied by S.I. 2009/470, reg. 33(1) (as substituted (6.4.2013) by The Education (Student Loans) (Repayment) (Amendment) Regulations 2013 (S.I. 2013/607), regs. 1(1), 9)
- C2
Sch. 38 applied (with application in accordance with reg. 1 of the amending S.I.) by The Education (Postgraduate Masters Degree Loans) Regulations 2016 (S.I. 2016/606), regs. 1(1), 24(2)
- C3
Sch. 38 applied (with application in accordance with reg. 1 of the amending S.I.) by The Education (Postgraduate Masters Degree Loans) Regulations 2016 (S.I. 2016/606), regs. 1(1), 43(1)
- C4
Sch. 38 applied (with application in accordance with reg. 1(2) of the amending S.I.) by The Social Security (Contributions) (Amendment and Application of Schedule 38 to the Finance Act 2012) Regulations 2013 (S.I. 2013/622), regs. 1, 41 (as amended (1.4.2026) by Finance Act 2026 (c. 11), s. 250(2), Sch. 22 para. 35)