If the trader fails to submit a return on time, generally he will be sent a reminder and if this has no effect, an estimated assessment may then be made. The trader then has 30 days within which to submit a return, and if he fails to do so, the amount charged in the assessment becomes a debt due to the Crown, collectible in the normal way (Value Added Tax Act 1994, s. 73).
If a trader submits a late return, he will enter the default surcharge regime if he accepts an estimate assessment which differs markedly from the amount of tax which he should have accounted for, then he may risk a misdeclaration penalty.
Should the trader wish to appeal against an estimated assessment he can usually only due so if the outstanding return has been submitted and the VAT assessed as due for the period has been paid.
In the case of a persistent failure by the trader to submit his returns or pay the VAT due, HMRC can assess either:-