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Finance (No. 2) BillPage 400

(5) A claim is not finally determined until it, or the amount to which it relates,
can no longer be varied (whether on appeal or otherwise).

Contract settlements

34 (1) In paragraph 29(1)(a) the reference to an amount paid by a person by way of
5tax includes an amount paid by a person under a contract settlement in
connection with tax believed to be due.

(2) Sub-paragraphs (3) to (6) apply if the person who paid the amount under the
contract settlement (“the payer”) and the person from whom the tax was due
(“the taxpayer”) are not the same person.

(3) 10In relation to a claim under paragraph 29 in respect of that amount—

(a) the references to the claimant in paragraph 30(5), (6) and (7) (Cases
D, E and F) have effect as if they included the taxpayer,

(b) the reference to the claimant in paragraph 30(8) (case G) has effect as
if it were a reference to the taxpayer,

(c) 15the reference to the claimant in paragraph 33(1)(b) has effect as if it
were a reference to the taxpayer, and

(d) references to tax in Schedule 11A to FA 2003 (as it applies to a claim
under paragraph 29) include the amount paid under the contract
settlement.

(4) 20Sub-paragraph (5) applies where the grounds for giving effect to a claim by
the payer in respect of the amount also provide grounds for a discovery
assessment on the taxpayer in respect of any single-dwelling interest.

(5) The Commissioners for Her Majesty’s Revenue and Customs may set any
amount repayable to the payer as a result of the claim against any amount
25payable by the taxpayer as a result of the assessment.

(6) The obligations of the Commissioners for Her Majesty’s Revenue and
Customs and the taxpayer are discharged to the extent of any set-off under
sub-paragraph (5).

(7) “Contract settlement” means an agreement made in connection with any
30person’s liability to make a payment to the Commissioners for Her Majesty’s
Revenue and Customs under or by virtue of an enactment.

Part 7 Reviews and appeals

Right of appeal

35 (1) 35An appeal may be brought against—

(a) an amendment of a self assessment under paragraph 10 (amendment
during enquiry to prevent loss of tax),

(b) a conclusion stated or amendment made by a closure notice (see
paragraph 16),

(c) 40an HMRC determination under paragraph 18 (determination of tax
chargeable if no return delivered),

(d) a discovery assessment (see paragraph 21), or

(e) an assessment under paragraph 22 (assessment to recover excessive
repayment).

Finance (No. 2) BillPage 401

(2) If an appeal under sub-paragraph (1)(a) against an amendment of a self
assessment is made while an enquiry is in progress none of the steps
mentioned in paragraph 38(2)(a) to (c) may be taken in relation to the appeal
until the enquiry is completed.

5Notice of appeal

36 (1) Notice of an appeal under paragraph 35 must be given—

(a) in writing,

(b) within 30 days after the specified date,

(c) to HMRC.

(2) 10In sub-paragraph (1) “specified date” means—

(a) in relation to an appeal under paragraph 35(1)(a), the date on which
the notice of amendment was issued;

(b) in relation to an appeal under paragraph 35(1)(b), the date on which
the closure notice was issued;

(c) 15in relation to an appeal under paragraph 35(1)(c) the date on which
the HMRC determination was issued;

(d) in relation to an appeal under paragraph 35(1)(d) or (e), the date on
which the notice of assessment was issued.

(3) The notice of appeal must specify the grounds of appeal.

(4) 20Where a determination has been made under paragraph 18 as to the amount
of tax to which a person is chargeable with respect to a single-dwelling
interest, the only grounds on which an appeal lies under paragraph 35(1)(c)
are—

(a) that the condition in section 91(2)(a) (nature and value of interest) is
25not met in relation to the interest in question on any day to which the
determination relates,

(b) that the person, partnership or scheme that the determination
identifies as meeting the ownership condition on one or more days
does not meet that condition on any day in the chargeable period,

(c) 30if the tax is determined to be chargeable by virtue of section 91(5),
that a person identified in the determination as one of the responsible
partners is not a responsible partner in relation to any tax chargeable
for the period in question, or

(d) if the tax is determined to be chargeable by virtue of section 91(6),
35that the person identified in the determination as the chargeable
person in relation to the collective investment scheme concerned is
not the chargeable person.

Late notice of appeal

37 (1) This paragraph applies in a case where—

(a) 40notice of appeal may be given to HMRC under this Schedule, but

(b) no notice is given before the relevant time limit.

(2) Notice may be given after the relevant time limit if—

(a) HMRC agree, or

(b) where HMRC do not agree, the tribunal gives permission.

Finance (No. 2) BillPage 402

(3) HMRC must agree to notice being given after the relevant time limit if the
appellant has requested in writing that HMRC do so and HMRC are
satisfied—

(a) that there was reasonable excuse for not giving the notice before the
5relevant time limit, and

(b) that the request has been made without unreasonable delay.

(4) If a request of the kind mentioned in sub-paragraph (3) is made, HMRC
must notify the appellant whether or not HMRC agree to the request.

(5) In this paragraph “relevant time limit”, in relation to notice of appeal, means
10the time before which the notice must to be given (disregarding this
paragraph).

Steps that may be taken following notice of appeal

38 (1) This paragraph applies if notice of appeal has been given to HMRC.

(2) In such a case—

(a) 15the appellant may notify HMRC that it requires them to review the
matter in question (see paragraph 39),

(b) HMRC may notify the appellant of an offer to review the matter in
question (see paragraph 40), or

(c) the appellant may notify the appeal to the tribunal.

(3) 20If the appellant notifies the appeal to the tribunal, the tribunal is to
determine the matter in question.

(4) See paragraphs 43 and 44 for provision about the circumstances in which an
appeal may be notified to the tribunal after a review has been required by
the appellant or offered by HMRC.

(5) 25This paragraph does not prevent the matter in question from being dealt
with in accordance with paragraph 46(1) (settling of appeals by agreement).

Right of appellant to require review

39 (1) If the appellant notifies HMRC that it requires them to review the matter in
question, HMRC must—

(a) 30notify the appellant of HMRC’s view of the matter in question within
the relevant period, and

(b) review the matter in question in accordance with paragraph 41.

(2) Sub-paragraph (1) does not apply if—

(a) the appellant has already given a notification under this paragraph
35in relation to the matter in question,

(b) HMRC have given a notification under paragraph 40 in relation to
the matter in question, or

(c) the appellant has notified the appeal to the tribunal.

(3) In this paragraph “the relevant period” means—

(a) 40the period of 30 days beginning with the day on which HMRC
receive the notification from the appellant, or

(b) such longer period as is reasonable.

Finance (No. 2) BillPage 403

Offer of review by HMRC

40 (1) Sub-paragraphs (2) to (5) apply if HMRC notify the appellant of an offer to
review the matter in question.

(2) The notification must include a statement of HMRC’s view of the matter in
5question.

(3) If the appellant notifies HMRC within the acceptance period that it accepts
the offer, HMRC must review the matter in question in accordance with
paragraph 41.

(4) If the appellant does not accept the offer in accordance with sub-paragraph
10(3)

(a) HMRC’s view of the matter in question is treated as if it were
contained in a settlement agreement (see paragraph 46(1)); but

(b) paragraph 46(3) (right to withdraw from agreement) does not apply
in relation to that notional agreement.

(5) 15Sub-paragraph (4) does not apply to the matter in question if, or to the extent
that, the appellant notifies the appeal to the tribunal.

(6) HMRC may not take the action mentioned in sub-paragraph (1) at any time
if before that time—

(a) HMRC have given a notification under this paragraph in relation to
20the matter in question,

(b) the appellant has given a notification under paragraph 39 in relation
to the matter in question, or

(c) the appellant has notified the appeal to the tribunal.

(7) In this paragraph “acceptance period” means the period of 30 days
25beginning with the date of the document by which HMRC notify the
appellant of the offer to review the matter in question.

Nature of review

41 (1) This paragraph applies if HMRC are required by paragraph 39 or 40 to
review the matter in question.

(2) 30The nature and extent of the review are to be such as appear appropriate to
HMRC in the circumstances.

(3) For the purpose of sub-paragraph (2), HMRC must, in particular, have
regard to steps taken before the beginning of the review—

(a) by HMRC in deciding the matter in question, and

(b) 35by any person in seeking to resolve disagreement about the matter in
question.

(4) The review must take account of any representations made by the appellant
at a stage which gives HMRC a reasonable opportunity to consider them.

(5) The review may conclude that HMRC’s view of the matter in question is to
40be—

(a) upheld,

(b) varied, or

Finance (No. 2) BillPage 404

(c) cancelled.

(6) HMRC must notify the appellant of the conclusions of the review and their
reasoning within—

(a) the period of 45 days beginning with the relevant day, or

(b) 5such other period as may be agreed.

(7) In sub-paragraph (6) “relevant day” means—

(a) in a case where the appellant required the review, the day when
HMRC notified the appellant of HMRC’s view of the matter in
question,

(b) 10in a case where HMRC offered the review, the day when HMRC
received notification of the appellant’s acceptance of the offer.

(8) If HMRC do not give notice of the conclusions of the review within the
period specified in sub-paragraph (6), the review is treated as having
concluded that HMRC’s view of the matter in question is upheld.

(9) 15If sub-paragraph (8) applies, HMRC must notify the appellant of the
conclusions which the review is treated as having reached.

Effect of conclusions of review

42 (1) If HMRC give notice of the conclusions of a review (see paragraph 41)—

(a) the conclusions are to be treated as if they were contained in a
20settlement agreement (see paragraph 46(1)), but

(b) paragraph 46(3) (withdrawal from agreement) does not apply in
relation to that notional agreement.

(2) Sub-paragraph (1) does not apply to the matter in question if, or to the extent
that, the appellant notifies the appeal to the tribunal (see paragraphs 43 and
2544).

Notifying appeal to tribunal after appellant has required review

43 (1) Where HMRC have notified an appellant under paragraph 39(1)(a) of their
view of a matter to which an appeal under paragraph 35 relates, the
appellant—

(a) 30may not notify the appeal to the tribunal before the beginning of the
post-review period;

(b) may notify the appeal to the tribunal after the end of that period only
if the tribunal gives permission.

(2) Except where sub-paragraph (3) applies, the post-review period is the
35period of 30 days beginning with the date of the document in which HMRC
give notice of the conclusions of the review in accordance with paragraph
41(6).

(3) If the period specified in paragraph 41(6) ends without HMRC having given
notice of the conclusions of the review, the post-review period is the period
40that—

(a) begins with the day following the last day of the period specified in
paragraph 41(6), and

(b) ends 30 days after the date of the document in which HMRC give
notice of the conclusions of the review in accordance with paragraph
4541(9).

Finance (No. 2) BillPage 405

Notifying appeal to tribunal after HMRC have offered review

44 (1) Where HMRC have offered to review the matter to which a notice of an
appeal under paragraph 35 relates, the right of the appellant at any time to
notify the appeal to the tribunal depends on whether or not the appellant has
5accepted the offer at that time.

(2) If the appellant has accepted the offer, the appellant—

(a) may not notify the appeal to the tribunal before the beginning of the
post-review period;

(b) may notify the appeal to the tribunal after the end of that period only
10if the tribunal gives permission.

(3) If the appellant has not accepted the offer, the appellant—

(a) may notify the appeal to the tribunal within the acceptance period;

(b) may notify the appeal to the tribunal after the end of that period only
if the tribunal gives permission.

(4) 15In this paragraph—

Interpretation of paragraphs 38 to 44

45 (1) In paragraphs 38 to 44

(a) 20“matter in question” means the matter to which an appeal relates;

(b) a reference to a notification is to a notification in writing.

(2) In paragraphs 38 to 44, a reference to the appellant includes a person acting
on behalf of the appellant except in relation to—

(a) notification of HMRC’s view under paragraph 39(1)(a),

(b) 25notification by HMRC of an offer of review (and of their view of the
matter) under paragraph 40,

(c) notification of the conclusions of a review under paragraph 41(6) or
(9).

(3) But if a notification falling within any of the paragraphs of sub-paragraph (2)
30is given to the appellant, a copy of the notification may also be given to a
person acting on behalf of the appellant.

Settling of appeals by agreement

46 (1) In relation to an appeal of which notice has been given under paragraph 36,
“settlement agreement” means an agreement between the appellant and an
35officer of Revenue and Customs that is—

(a) entered into before the appeal is determined, and

(b) to the effect that the decision appealed against should be upheld
without variation, varied in a particular manner or discharged or
cancelled.

(2) 40Where a settlement agreement is entered into in relation to an appeal, the
consequences are to be the same (for all purposes) as if, at the time the
agreement was entered into, the tribunal had decided the appeal and had
upheld the decision without variation, varied it in that manner or
discharged or cancelled it, as the case may be.

Finance (No. 2) BillPage 406

(3) Sub-paragraph (2) does not apply if, within 30 days from the date when the
settlement agreement was entered into, the appellant gives notice in writing
to HMRC that it wishes to withdraw from the agreement.

(4) Where a settlement agreement is not in writing—

(a) 5sub-paragraph (2) does not apply unless the fact that an agreement
was entered into, and the terms agreed, are confirmed by notice in
writing given by HMRC to the appellant or by the appellant to the
HMRC, and

(b) the references in sub-paragraphs (2) and (3) to the time when the
10agreement was entered into are to be read as references to the time
when the notice of confirmation was given.

(5) Sub-paragraph (6) applies where notice of an appeal has been given under
paragraph 36 and—

(a) the appellant notifies HMRC, orally or in writing, that the appellant
15does not wish to proceed with the appeal, and

(b) HMRC do not, within 30 days after that notification, give the
appellant notice in writing indicating that they are unwilling that the
appeal should be withdrawn.

(6) Sub-paragraphs (1) to (4) have effect as if, at the date of the appellant’s
20notification, the appellant and an officer of Revenue and Customs had
agreed (orally or in writing, as the case may be) that the decision under
appeal should be upheld without variation.

(7) References in this paragraph to an agreement being entered into with an
appellant, and to the giving of notice or notification by or to the appellant,
25include references to an agreement being entered into, or notice or
notification being given by or to, a person acting on behalf of the appellant
in relation to the appeal.

Appeal does not postpone recovery of tax

47 (1) Where there is an appeal under paragraph 35, the tax charged by the
30amendment or assessment in question remains due and payable as if there
had been no appeal.

(2) Sub-paragraph (1) is subject to paragraphs 48 and 49.

Application for payment of tax to be postponed

48 (1) If the appellant has grounds for believing that the amendment or assessment
35overcharges the appellant to tax, or as a result of the conclusion stated in the
closure notice the tax charged on the appellant is excessive, the appellant
may—

(a) first apply by notice in writing to HMRC within 30 days of the
specified date for a determination by them of the amount of tax the
40payment of which should be postponed pending the determination
of the appeal, and

(b) if the appellant does not agree with a determination made by HMRC
under paragraph (a), refer the application for postponement to the
tribunal within 30 days from the date of the document notifying
45HMRC’s determination.

Finance (No. 2) BillPage 407

(2) An application under sub-paragraph (1)(a) must state the amount believed
to be overcharged to tax and the grounds for that belief.

(3) An application may be made more than 30 days after the specified date if
there is a change in the circumstances of the case as a result of which the
5appellant has grounds for believing that it is overcharged to tax by the
decision appealed against.

(4) If, after an application under sub-paragraph (1) has been determined, there
is a change in the circumstances of the case as a result of which either party
has grounds for believing that the amount determined has become either
10excessive or insufficient, that party may (if the parties cannot agree on a
revised determination) apply to the tribunal for a revised determination of
that amount.

(5) An application under sub-paragraph (4) may be made at any time before the
determination of the appeal.

(6) 15An application under this paragraph is to be subject to the relevant
provisions of Part 5 of the Taxes Management Act 1970 (see, in particular,
section 48(2)(b) of that Act).

(7) The amount of tax of which payment is to be postponed pending the
determination of the appeal is the amount (if any) by which it appears that
20there are reasonable grounds for believing that the appellant is overcharged.

(8) Where an application under this paragraph has been determined, section
161 has effect in relation to any tax of which payment is not postponed as
if—

(a) the tax were payable in accordance with an assessment under
25paragraph 22 issued on the date on which the application was
determined, and

(b) there was no appeal against that assessment.

(9) In this paragraph “specified date” has the meaning given by paragraph 36.

Agreement to postpone payment of tax

49 (1) 30If the appellant and an officer of Revenue and Customs agree that payment
of an amount of tax should be postponed pending the determination of the
appeal, the consequences are to be the same (for all purposes) as if the
tribunal had, at the time when the agreement was entered into, made a
direction to the same effect as the agreement.

(2) 35Where the agreement is not in writing—

(a) sub-paragraph (1) does not apply unless the fact that an agreement
was entered into, and the terms agreed, are confirmed by notice in
writing given by the officer of Revenue and Customs to the appellant
or by the appellant to that officer, and

(b) 40the reference in sub-paragraph (1) to the time when the agreement
was entered into is to be read as a reference to the time when notice
of confirmation was given.

Finance (No. 2) BillPage 408

(3) References in this paragraph to an agreement being entered into with an
appellant, and to the giving of notice to or by the appellant, include
references to an agreement being entered into, or notice being given to or by,
a person acting on behalf of the appellant in relation to the appeal.

5Assessments and self assessments

50 (1) This paragraph applies where an appeal under paragraph 35(1) has been
notified to the tribunal.

(2) If the tribunal decides that the appellant is overcharged by a self assessment
or any other assessment, the assessment must be reduced accordingly.

(3) 10If the tribunal does not so decide, the assessment is to stand good.

(4) If it appears to the tribunal that the appellant is undercharged to tax by a self
assessment or any other assessment, the assessment must be increased
accordingly.

Tribunal determinations

51 15The determination of the tribunal in relation to any proceedings under this
Part of this Schedule is to be final and conclusive except as otherwise
provided in—

(a) sections 9 to 14 of the Tribunals, Courts and Enforcement Act 2007, or

(b) this Part of this Act.

20Payment of tax where appeal has been determined

52 (1) On the determination of an appeal under paragraph 35 any tax overpaid
must be repaid.

(2) On the determination of an appeal under paragraph 35, section 161
(payment of tax) has effect in relation to any relevant tax as if—

(a) 25the tax were payable in accordance with an assessment under
paragraph 22 issued on the date on which HMRC issues to the
appellant a notice of the total amount payable in accordance with the
determination, and

(b) there had been no appeal against that assessment.

(3) 30The reference in sub-paragraph (2) to “relevant tax” is to any tax payable in
accordance with the determination, so far as it is tax—

(a) the payment of which had been postponed, or

(b) which would not have been charged by the amendment or
assessment if there had been no appeal.

35Payment of tax where there is a further appeal

53 (1) Where a party to an appeal to the tribunal under paragraph 35 makes a
further appeal, tax is to be payable or repayable in accordance with the
determination of the tribunal or court (as the case may be), even though the
further appeal is pending.

(2) 40But if the amount charged by the assessment is altered by the order or
judgment of the Upper Tribunal or court, then—

Finance (No. 2) BillPage 409

(a) if too much tax has been paid, the amount overpaid must be
refunded, with any interest allowed by the order or judgment, and

(b) if too little tax has been charged, the amount undercharged is due
and payable at the end of the 30 days beginning with the date on
5which HMRC issue to the other party a notice of the total amount
payable in accordance with the order or judgment.

References to “the tribunal”

54 (1) In this Part of this Schedule “the tribunal” means—

(a) the First-tier Tribunal, or

(b) 10where determined by or under Tribunal Procedure Rules, the Upper
Tribunal.

(2) Sub-paragraph (1) does not apply so far as sub-paragraph (3) requires
otherwise.

(3) Where the question in any dispute on any appeal under paragraph 35(1) is
15of the market value of any single-dwelling interest, that question is to be
determined on a reference by—

(a) the Upper Tribunal, if the land is in England and Wales;

(b) the Lands Tribunal for Scotland, if the land is in Scotland;

(c) the Lands Tribunal for Northern Ireland, if the land is in Northern
20Ireland.

Part 8 Supplementary

Application of Schedule in cases involving joint liability to tax

55 (1) This paragraph applies where—

(a) 25section 94(2) applies and the other persons mentioned in section
94(1)(b) include a company, or

(b) section 94(4) applies and P is a company.

(2) Any obligation to deliver a return with respect to the single-dwelling
interest for the chargeable period concerned is a joint obligation of the
30persons who are jointly and severally liable under subsection (2) or (as the
case may be) (4) of section 94; and a single return is required.

Partnerships

56 In relation to a return delivered by the responsible partners for a
partnership, anything required or authorised under section 157 or this
35Schedule to be done by the responsible partners is required or authorised to
be done by all the responsible partners.

57 In this Schedule “return”, except where the contrary is indicated, means an
annual tax on enveloped dwellings return or a return of the adjusted
chargeable amount.

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