Penalty Reimbursement Policy

1. Introduction

TaxStats Ltd ("TaxStats") is committed to meeting all filing deadlines on behalf of our clients. In the rare event that a penalty is incurred due to an error or failure on our part, this Penalty Reimbursement Policy sets out the circumstances in which we will reimburse you for penalties charged by HMRC or other regulatory bodies.

This policy applies to all clients with an active paid subscription to TaxStats services. It does not apply to users on the free plan.

2. Scope — What Penalties Are Covered

This policy covers penalties for the late filing of tax returns, VAT returns, payroll RTI submissions, confirmation statements, and other statutory filings that TaxStats has been engaged to prepare and submit on your behalf. Specifically, the following types of penalties are covered:

• Late filing penalties for Self Assessment tax returns (SA100)
• Late filing penalties for corporation tax returns (CT600)
• Late submission penalties for VAT returns under Making Tax Digital
• Late filing penalties for payroll RTI submissions (FPS and EPS)
• Late filing penalties for confirmation statements with Companies House
• Late filing penalties for annual accounts with Companies House
• Penalties for incorrect returns where the error was caused by TaxStats

3. Conditions for Reimbursement

We will reimburse you for penalties where all of the following conditions are met:

• Our responsibility: The penalty was incurred as a direct result of an error, omission, or delay by TaxStats. This includes situations where we failed to submit a filing by the deadline, submitted incorrect information due to our error, or failed to act on instructions you provided in a timely manner.
• Timely information: You provided all information and documentation required for the filing at least 14 days before the filing deadline (or such other period as specified in your engagement letter). If you provided information late, we will assess the claim on a case-by-case basis considering whether the delay on your part contributed to the penalty.
• Active engagement: You had an active paid subscription at the time the filing was due and had not cancelled or suspended your services.
• Notification: You notify us of the penalty within 30 days of receiving the penalty notice from HMRC or the relevant body.

4. Exclusions

We will not reimburse penalties in the following circumstances:

• Client delay: Where the penalty was caused wholly or partly by your failure to provide information, documents, or approvals in a timely manner.
• Incorrect client information: Where the penalty resulted from incorrect or incomplete information provided by you that we had no reasonable way of identifying as inaccurate.
• Client instruction: Where you instructed us not to file by the deadline or to delay a filing.
• Matters outside our engagement: Penalties for filings or obligations that were not within the scope of our engagement with you.
• HMRC disputes: Penalties arising from HMRC investigations, enquiries, or determinations that are not related to the accuracy or timeliness of our filing work.
• Late payment penalties: Penalties for late payment of tax. We remind you of payment deadlines but are not responsible for making tax payments on your behalf unless specifically engaged to do so.
• Force majeure: Penalties caused by events beyond our reasonable control, including HMRC system outages, internet service failures, natural disasters, or government actions.
• Free plan: Users on the free plan are not covered by this policy.

5. Claims Process

To make a claim under this policy, please follow these steps:

• Step 1: Contact us at info@taxstats.co.uk within 30 days of receiving the penalty notice, providing a copy of the penalty notice and any supporting correspondence from HMRC or the relevant body.
• Step 2: Our compliance team will review the claim and investigate the circumstances of the penalty. We may need to request additional information from you during this process.
• Step 3: We will provide a written decision within 20 working days of receiving all necessary information. The decision will explain whether the claim is accepted in full, accepted in part, or rejected, with reasons.
• Step 4: If the claim is accepted, we will reimburse the penalty amount within 14 days of the decision. Reimbursement will be made by the same method as your regular service payments (credit to your account or direct payment).

Before making a reimbursement, we will first attempt to have the penalty cancelled or reduced through an appeal to HMRC or the relevant body where we believe there are reasonable grounds. If the appeal is successful, no reimbursement is required. If the appeal is partially successful, we will reimburse any remaining penalty that falls within the scope of this policy.

6. Maximum Reimbursement Amounts

The maximum reimbursement under this policy is subject to the following limits:

• Per incident: The maximum reimbursement for any single penalty or group of related penalties is 5,000 pounds.
• Per year: The maximum total reimbursement in any 12-month period is 10,000 pounds per client.
• Interest and surcharges: We will reimburse reasonable interest charges that HMRC applies to the penalty itself, but not interest on late-paid tax.

For penalties exceeding these limits, we will discuss the situation with you and consider the claim under our professional indemnity insurance where appropriate.

7. Time Limits for Claims

Claims under this policy must be submitted within 30 days of receiving the penalty notice from HMRC or the relevant body. Claims submitted after this deadline may be considered at our discretion but are not guaranteed to be accepted.

We recommend that you forward any penalty notices to us immediately upon receipt so that we can assess the situation and, if appropriate, file an appeal within HMRC's appeal deadline.

8. Interaction with Professional Indemnity Insurance

This policy operates independently of our professional indemnity insurance. For claims that exceed the limits of this policy or that involve losses beyond the penalty itself (such as additional tax or professional fees), you may be able to make a claim under our professional indemnity insurance. We will advise you if we believe a claim should be directed to our insurers.

9. Continuous Improvement

Every penalty claim triggers an internal review to identify the root cause and implement measures to prevent recurrence. We track penalty reimbursement claims as a key quality metric and report the data to management quarterly.

10. Changes to This Policy

We may update this policy from time to time. Material changes will be communicated to clients by email at least 30 days before they take effect. The current version of this policy is always available on our website.

11. Contact

If you have any questions about this policy or wish to make a claim, please contact us at:

TaxStats Ltd
Work.Life, 30 Brown Street, Manchester, M2 1DH
Email: info@taxstats.co.uk
Phone: +44 (0) 161 552 4774