British soldiers in Afghanistan today killed four civilians and injured three more after opening fire on a vehicle that failed to stop at a checkpoint, Nato and defence ministry officials said.

The incident happened near a UK military base in the south of the country from where an army dog handler set out before being killed in an ambush two days ago.

The Nato mission in the country issued a statement saying the incident – which it blamed on the "reckless actions" of the driver - took place earlier today in the Sangin district of Helmand province.

"The vehicle approached the checkpoint and was directed to stop but it drove on … Soldiers fired warning shots in a safe direction away from the vehicle but were eventually forced to fire at it when it refused to stop, fearing an insurgent attack," the statement said.

It identified the troops only as coming from Isaf, the international Nato-led force in the country. However, Ministry of Defence officials in London later confirmed that they were British.

Troops had to bear in mind the risk that vehicles which fail to stop could contain explosives, an MoD spokesman said, adding: "It's regrettable that this has happened but it's very hard to make these decisions."

UK troops in Afghanistan are predominantly based in Helmand province. The Nato statement also said that those injured in the incident were taken to military forward operating base Inkerman, a British army outpost.

Nato said that two other people in the car were uninjured and took the bodies of the four dead civilians back to their village. It added: "Both indicated that the driver of the vehicle was at fault for failing to stop when required to do so."

The statement ended: "ISAF deeply regrets this unnecessary incident caused by the reckless actions of the vehicle driver. The incident will be investigated."

The issue of civilians being killed by Nato action is an increasingly sensitive one for Afghanistan's government. The country's president, Hamid Karzai, has urged US and other troops to do all they can to avoid civilian deaths for fear of making his regime more unpopular.

The dog handler died on Thursday night after his patrol came under fire while on routine patrol from Inkerman. He was named today as Lance Corporal Kenneth Michael Rowe of the Royal Army Veterinary Corps.

He was due to leave front line duties the day before he died, the MoD said today. His commanding officer, Major Stuart McDonald, said he had been due to leave the base on Wednesday but asked to stay because he was worried about the lack of cover.

"This unselfish action epitomised his professionalism and dedication to his job," he added.