38(1)This paragraph applies if—U.K.
(a)a penalty under paragraph 31 is assessed under paragraph 35,
(b)the failure in respect of which that assessment is made continues for more than 30 days beginning with the date on which notification of that assessment is given, and
(c)the data-holder has been told that an application may be made under this paragraph for an increased daily penalty to be imposed.
(2)If this paragraph applies, an officer of Revenue and Customs may make an application to the tribunal for an increased daily penalty to be imposed on the data-holder.
(3)If the tribunal decides that an increased daily penalty should be imposed, then for each applicable day (see paragraph 39) on which the failure continues—
(a)the data-holder is not liable to a penalty under paragraph 31 in respect of the failure, and
(b)the data-holder is liable instead to a penalty under this paragraph of an amount determined by the tribunal.
(4)The tribunal may not determine an amount exceeding £1,000 for each applicable day.
(5)But subject to that, in determining the amount the tribunal must have regard to—
(a)the likely cost to the data-holder of complying with the data-holder notice,
(b)any benefits to the data-holder of not complying with it, and
(c)any benefits to anyone else resulting from the data-holder's non-compliance.
39(1)If a data-holder becomes liable to a penalty under paragraph 38, HMRC must notify the data-holder.U.K.
(2)The notification must specify the day from which the increased penalty is to apply.
(3)That day and any subsequent day is an “applicable day” for the purposes of paragraph 38(3).