A Personal Liability Notice (PLN) may be issued by HMRC in the event of a company's or a Limited Liability Partnership's (LLP's) failure to pay its tax debts or tax penalties to HMRC. A PLN will transfer all or part of the liability to pay the debt to one of its officers.

  • A PLN is generally only used in cases where HMRC can prove that the underlying payment failure is attributable to the fraud or serious neglect of an officer.
  • A PLN will typically be issued when a company goes into liquidation with tax debts.

There are two main types of PLN:

PLNs for National Insurance Contributions debt:

  • A PLN may only be served if HMRC can prove that the non-payment of tax is attributable to the fraud or neglect of one or more of the company’s officers.

PLNs for VAT penalties:

  • A PLN may apply if a company is liable to a VAT penalty for deliberate wrongdoing.
  • The VAT wrongdoing is attributable to the deliberate action of an officer or officers of the company.
  • In addition, the PLN can only be issued if one of the following circumstances exists:
    • The officer gainer, or attemted to gain, personally from the wrongdoing.
    • The company is, or is likely to become, insolvent.

The conditions for imposing a VAT PLN are far stricter than those for imposing a NICs PLN.

Who is an officer?

  • Company officers include elected officers, managers and anyone who is acting in the role of director.
  • LLP officers are members.

Officers can mitigate the risk of being served a PLN by ensuring that they are properly advised in the event of potential corporate failure and take prompt and reasonable action to obtain advice and mitigate the situation in the event that the company starts to have tax payment issues. 



An officer can appeal an NICs PLN on the basis that:

  • The PLN should not have been raised on the amounts in question.
  • The failure to pay was not due to fraud or negligence on the part of the officer in question.
  • The individual was not an officer of the company at the time of the alledged fraud or negligence.
  • HMRC's opinion in raising the PLN was unreasonable.

This must be made in writing to HMRC. This also affords the individual to request a postponement of the liability due under the PLN until the appeal is settled.


  • An officer may appeal against the issue of the VAT PLN.
  • PLNs are subject to the same procedures as company penalties.
  • An officer of a company or LLP may apeal either the decision to raise a PLN against them or the amount of the PLN.
  • An appeal against a PLN is not an appeal against the underlying company penalty,nor does the outcome of the appeal affect the status of the company penalty. Only the company can appeal the company penalty.


NICs: Section 121C of the Social Security Administration Act 1992 (SSAA 1992)

VAT: Para 22 Schedule 41 FA 2008  https://www.legislation.gov.uk/ukpga/2008/9/schedule/41

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