Where information and/or documents requested by HMRC have not been produced HMRC can charge an initial penalty of £300 followed by daily penalties of up to £60 a day for every day after the date the initial penalty is assessed until the information or documents are provided.
No penalty will be charged if the person has a reasonable excuse for failing to comply with the notice.  HMRC consider a reasonable excuse to be something that stops a person from meeting a tax obligation despite them having taken reasonable care to meet that obligation. It is necessary to consider what a reasonable person, who wanted to meet their obligation would have done in the same circumstances and decide if the action of the person met that standard as outlined by Judge Medd in The Clean Car Company (LON/90/138X).