31(1)A person may appeal against a decision of HMRC—
(a)that a penalty is payable under Part 3 of this Schedule, or
(b)as to the amount of a penalty payable under Part 3 or 4 of this Schedule.
(2)Notice of appeal must be given—
(a)in writing to HMRC, and
(b)before the end of the period of 30 days beginning with the day on which notification of the penalty was issued.
(3)It must state the grounds of appeal.
(4)On an appeal under sub-paragraph (1)(a) that is notified to the tribunal, the tribunal may confirm or cancel the decision.
(5)On an appeal under sub-paragraph (1)(b) that is notified to the tribunal, the tribunal may—
(a)confirm the decision, or
(b)substitute for the decision another decision that HMRC had power to make.
(6)If, in the case of an appeal against a penalty under Part 4, the tribunal substitutes its decision for HMRC’s, the tribunal may rely on paragraph 27 (special reduction)—
(a)to the same extent as HMRC (which may mean applying the same reduction as HMRC to a different starting point), or
(b)to a different extent, but only if the tribunal thinks that HMRC’s decision in respect of the application of that paragraph was flawed (when considered in the light of the principles applicable in proceedings for judicial review).
(7)Subject to this paragraph and paragraph 32, the provisions of Part 5 of TMA 1970 relating to appeals have effect in relation to an appeal under this paragraph as they have effect in relation to an appeal against an assessment to income tax.