HMRC Customer Correction Notices: What Draft Rules Mean Before 7 September

On 13 July 2026 HMRC published draft Finance Bill 2026-27 legislation on modernising the correction of errors. The package makes explicit a taxpayer obligation to take corrective action once an inaccuracy is identified, and creates a new Customer Correction Notice that can require you to check your position, correct the error, or explain why no correction is needed.

The technical consultation closes on 7 September 2026. Comments go to tarcompliance@hmrc.gov.uk. The measure takes effect only on a future appointed day — it is not live filing law today — but sole traders, landlords, companies, and agents should understand the direction of travel while the draft is still open for comment.

What the draft obligation requires

HMRC’s policy paper states that where you become aware of an inaccuracy in a return or document covered by Schedule 24 to the Finance Act 2007, you must take corrective action — either by correcting it yourself or by notifying HMRC where a direct correction is not possible. The duty applies only while you or HMRC remain within existing statutory time limits for amending returns or making assessments.

If you become aware of an inaccuracy and do not take reasonable steps to correct or notify HMRC, the draft would treat that inaccuracy as deliberate for penalty and assessment time-limit purposes. That is a material shift from today’s informal expectation that people “ought to” fix mistakes: silence after discovery would be framed as deliberate behaviour.

How a Customer Correction Notice would work

HMRC would gain a power to issue a Customer Correction Notice requiring a response — correct the inaccuracy, make a disclosure, or confirm that no correction is required. The draft pairs that notice with penalty design: where you take reasonable steps to secure a correction after your first Customer Correction Notice in a six-year period, inaccuracy penalties would apply only to deliberate errors on that first notice path.

Errors found later when HMRC scrutinises your correction response — or the absence of a correction — would generally be presumed careless unless the inaccuracy is deliberate or you can show you took reasonable care initially. For SMEs, the practical message is clear: keep working papers that show how figures were built, so a notice response is a review exercise rather than a reconstruction.

What to do before 7 September — and afterwards

If you advise clients or run in-house tax, skim the draft legislation and explanatory note and decide whether to submit a technical comment by 7 September. Focus feedback on operative clarity: when “awareness” arises, how agents should evidence reasonable steps, and how Customer Correction Notices interact with existing Self Assessment and Corporation Tax amendment windows.

Whether or not you comment, strengthen self-correction muscle now. Monthly bank and VAT reconciliations, clear digital trails for MTD Income Tax quarters, and exportable Corporation Tax packs make it easier to spot and fix errors inside time limits — the same hygiene the draft is designed to reward.

How FinnAccountings helps with accurate packs

Organised books make error spotting and correction cheaper. FinnAccountings helps Ireland and UK businesses prepare bookkeeping and tax packs with Chartered Accountant insight before you or your ICAEW/ACCA or Chartered Accountant (Ireland) adviser reviews filings. Start a free trial for review-ready drafts — we prepare records; we do not issue responses to HMRC notices or file corrections on your behalf.

Start a free trial →

Related reading

Pair this draft with HMRC’s information powers and computer records consultation, which also closes on 7 September 2026.

HMRC information powers & digital records reform →

For the wider Legislation Day package that introduced Customer Correction Notices alongside other draft measures, read the Finance Bill 2026-27 overview.

UK Finance Bill 2026-27 Legislation Day overview →

Use the dual-market tax calculator for high-level Income Tax and National Insurance planning only — not as a substitute for amending a filed return.

Open free tax calculator (Ireland & UK) →