Finance Act 1998

• (a) the filing date, or

• (b) in the case of a return for the wrong period, what would be the filing date if the period for which the return was made were an accounting period.

Correction of return by Revenue

16

• (1) An officer of Revenue and Customs may amend a company tax return so as to correct—

• (a) obvious errors or omissions in the return (whether errors of principle, arithmetical mistakes or otherwise), and

• (b) anything else in the return that the officer has reason to believe is incorrect in the light of information available to the officer.

• (2) A correction under this paragraph is made by notice to the company concerned.

• (3) No such correction may be made more than nine months after—

• (a) the day on which the return was delivered, or

• (b) if the correction is required in consequence of an amendment by the company under paragraph 15, the day on which that amendment was made.

• (4) A correction under this paragraph is of no effect if the company—

• (a) amends its return so as to reject the correction, or

• (b) after the end of the period within which it may amend its return, but within three months from the date of issue of the notice of correction, gives notice rejecting the correction.

• (5) Notice under sub-paragraph (4)(b) must be given—

• (a) in writing,

• (b) to the officer of the Board by whom notice of the correction was given.

Failure to deliver return: flat-rate penalty

17

• (1) A company which is required to deliver a company tax return and fails to do so by the filing date is liable to a flat-rate penalty under this paragraph.

It may also be liable to a tax-related penalty under paragraph 18.

• (2) The penalty is—

• (a) £200, if the return is delivered within three months after the filing date, and

• (b) £400, in any other case.

• (3) The amounts are increased to £1000 and £2000 for a third successive failure, that is, where—

• (a) the company is within the charge to corporation tax for three consecutive accounting periods (and at no time between the beginning of the first of those periods and the end of the last is it outside the charge to corporation tax),

• (b) a company tax return is required for each of those accounting periods,

• (c) the company was liable to a penalty under this paragraph in respect of each of the first two of those periods, and

• (d) the company is again liable to a penalty under this paragraph in respect of the third period.

• (4) The first or second period mentioned in sub-paragraph (3) may be a period ending before the self-assessment appointed day, in relation to which—

• (a) the reference in paragraph (b) to a company tax return shall be construed as a reference to a return under section 11 of the Taxes Management Act 1970, and

• (b) the references in paragraphs (c) and (d) to a penalty under this paragraph shall be construed as a reference to a penalty under section 94 of that Act.

• (5) The Commissioners for His Majesty’s Revenue and Customs may by regulations amend sub-paragraph (2) or (3) so as to increase or decrease the amount of a penalty for the time being specified in those sub-paragraphs.

• (6) Regulations under sub-paragraph (5) may include transitional and saving provision.

• (7) A statutory instrument containing regulations under sub-paragraph (5) which increase the amount of a penalty by more than is necessary to reflect changes in the value of money may not be made unless a draft of the instrument has been laid before and approved by a resolution of the House of Commons.

Failure to deliver return: tax-related penalty

18

• (1) A company which is required to deliver a company tax return for an accounting period and fails to do so—

• (a) within 18 months after the end of that period, or

• (b) if the filing date is later than that, by the filing date,

is liable to a tax-related penalty under this paragraph.

This is in addition to any flat-rate penalty under paragraph 17.

• (2) The penalty is—

• (a) 10 per cent. of the unpaid tax, if the return is delivered within two years after the end of the period for which the return is required, and

• (b) 20 per cent. of the unpaid tax, in any other case.

• (3) The “unpaid tax” means the amount of tax payable by the company for the accounting period for which the return was required which remains unpaid on the date when the liability to the penalty arises under sub-paragraph (1).

• (4) In determining that amount no account is to be taken of—

• (a) any relief under section 458 of the Corporation Tax Act 2010 (relief in respect of repayment, etc of loan) which is deferred under subsection (5) of that section, or

• (b) any relief under section 464B of that Act (relief in respect of return payment) which is deferred under subsection (5) of that section.

Excuse for late delivery of return

19

A company is not liable to a penalty under paragraph 17 (flat rate penalty) if—

• (a) the period for which the return is required is one for which the company is required to deliver accounts under the Companies Act 2006, and

• (b) the return is delivered no later than the last day for the delivery of those accounts to the registrar of companies.

Penalty for incorrect or uncorrected return

20

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Voluntary returns

20A

• (1) This paragraph applies where—

• (a) a company delivers a purported return (“the relevant return”) for a period (“the relevant period”),

• (b) no notice under paragraph 3 has been given to the company in respect of the relevant period, and

• (c) Her Majesty’s Revenue and Customs treats the relevant return as a return made and delivered in pursuance of such a notice.

• (2) For the purposes of the Taxes Acts—

• (a) treat a relevant notice as having been given to the company on the day the relevant return was delivered, and

• (b) treat the relevant return as having been made and delivered in pursuance of that notice (and, accordingly, treat it as if it were a company tax return under paragraph 3).

• (3) “Relevant notice” means a notice under paragraph 3 requiring the company to deliver a return for the relevant period.

• (4) In sub-paragraph (1)(a) “purported return” means anything that—

• (a) is in a form, and is delivered in a way, that a corresponding return could have been made and delivered had a relevant notice been given, and

• (b) purports to be a company tax return.

• (5) Nothing in this paragraph affects paragraph 46 or any other provisions of the Taxes Acts specifying a time limit for the making of an assessment.

Part III — Duty to keep and preserve records

Duty to keep and preserve records

21

• (1) A company which may be required to deliver a company tax return for any period must—

• (a) keep such records as may be needed to enable it to deliver a correct and complete return for the period, and

• (b) preserve those records in accordance with this paragraph.

• (2) The records must be preserved until the end of the relevant day.

• (2A) In this paragraph “relevant day” means—

• (a) the sixth anniversary of the end of the period for which the company may be required to deliver a company tax return, or

• (b) such earlier day as may be specified in writing by the Commissioners for Her Majesty's Revenue and Customs (and different days may be specified for different cases).

• (3) If the company is required to deliver a company tax return by notice given before the end of the relevant day, the records must be preserved until any later date on which—

• (a) any enquiry into the return is completed, or

• (b) if there is no enquiry, an officer of Revenue and Customs no longer has power to enquire into the return.

• (4) If the company is required to deliver a company tax return by notice given after the end of the relevant day and has in its possession at that time any records that may be needed to enable it to deliver a correct and complete return, it is under a duty to preserve those records until the date on which—

• (a) any enquiry into the return is completed, or

• (b) if there is no enquiry, an officer of Revenue and Customs no longer has power to enquire into the return.

• (5) The records required to be kept and preserved under this paragraph include records of—

• (a) all receipts and expenses in the course of the company’s activities, and the matters in respect of which the receipts and expenses arise, and

• (b) in the case of a trade involving dealing in goods, all sales and purchases made in the course of the trade.

• (5A) The Commissioners for Her Majesty's Revenue and Customs may by regulations—

• (a) provide that the records required to be kept and preserved under this paragraph include, or do not include, records specified in the regulations, and

• (b) provide that those records include supporting documents so specified.

• (5AA) Regulations under this paragraph may make provision, in relation to relevant transfer pricing records specified, or of a description specified, in the regulations—

• (a) as to the form or manner in which those records are to be kept and preserved;

• (b) by reference to things specified in the transfer pricing guidelines (within the meaning of section 164 of TIOPA 2010 (interpretation in accordance with OECD principles)).

• (5B) Regulations under this paragraph may—

• (a) make different provision for different cases, and

• (b) make provision by reference to things specified in a notice published by the Commissioners for Her Majesty's Revenue and Customs in accordance with the regulations (and not withdrawn by a subsequent notice).

• (6) For the purposes of this paragraph—

• (a) records are “relevant transfer pricing records” if the Commissioners for His Majesty’s Revenue and Customs reasonably consider that the records may relate to the calculation of profits or losses in accordance with Part 4 of TIOPA 2010 (transfer pricing);

• (b) “supporting documents” includes accounts, books, deeds, contracts, vouchers and receipts.

Preservation of information etc

22

• (1) The duty under paragraph 21 to preserve records may be discharged—

• (a) by preserving them in any form and by any means, or

• (b) by preserving the information contained in them in any form and by any means,

subject to sub-paragraph (3) and any conditions or exceptions specified in writing by the Commissioners for Her Majesty's Revenue and Customs.

• (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (3) Sub-paragraph (1)(b) does not apply in the case of the following kinds of records—

• (a) any statement in writing such as is mentioned in—

• (i) section 1100(1) of the Corporation Tax Act 2010 (amount of distribution, but formerly amount of qualifying distribution and tax credit), or

• (ii) section 495(1) or 975(2) or (4) of the Income Tax Act 2007 (statements about deduction of income tax),

provided by the company or person there mentioned whether after the making of a request or otherwise;

• (b) any record (however described) which is required by regulations under section 70(1)(c) of the Finance Act 2004 to be given to a sub-contractor (within the meaning of section 58 of that Act) on the making of a payment to which section 61 of that Act (deductions on account of tax) applies;

• (c) any record relating to an amount of tax—

• (i) paid under the law of a territory outside the United Kingdom, or

• (ii) which would have been payable under the law of a territory outside the United Kingdom (“territory F”) but for a development relief.

• (4) In sub-paragraph (3)(c) “development relief” means a relief—

• (a) given under the law of territory F with a view to promoting industrial, commercial, scientific, educational or other development in a territory outside the United Kingdom, and

• (b) about which provision is made in arrangements which have effect under section 2(1) of TIOPA 2010 (double taxation relief by agreement with territories outside the United Kingdom).

Penalty for failure to keep and preserve records

23

• (1) A company which fails to comply with paragraph 21 in relation to an accounting period is liable to a penalty not exceeding £3,000, subject to the following exceptions.

• (2) No penalty is incurred if the records which the company fails to keep or preserve are records which might have been needed only for the purposes of claims, elections or notices not included in the return.

• (3) No penalty is incurred if—

• (a) the records which the company fails to keep or preserve are statements in writing such as are mentioned in—

• (i) section 1100(1) of the Corporation Tax Act 2010 (amount of distribution, but formerly amount of qualifying distribution and tax credit), or

• (ii) section 495(1) or 975(2) or (4) of the Income Tax Act 2007 (statements about deduction of income tax),

provided by the company or person there mentioned whether after the making of a request or otherwise, and

• (b) an officer of Revenue and Customs is satisfied that any facts which he reasonably requires to be proved, and which would have been proved by the records, are proved by other documentary evidence furnished to him.

Part IV — Enquiry into company tax return

Notice of enquiry

24

• (1) An officer of Revenue and Customs may enquire into a company tax return if he gives notice to the company of his intention to do so (“notice of enquiry") within the time allowed.

• (2) If the return was delivered on or before the filing date, notice of enquiry may be given at any time up to twelve months from the day on which the return was delivered (subject to sub-paragraph (6)).

• (3) If the return was delivered after the filing date, notice of enquiry may be given at any time up to and including the 31st January, 30th April, 31st July or 31st October next following the first anniversary of the day on which the return was delivered.

• (4) If the company amends its return, notice of enquiry may be given at any time up to and including the 31st January, 30th April, 31st July or 31st October next following the first anniversary of the day on which the amendment was made.

• (5) A return which has been the subject of one notice of enquiry may not be the subject of another, except one given in consequence of an amendment (or another amendment) by the company of its return.

• (6) In the case of a company which is a member of a group other than a small group, the 12-month period in sub-paragraph (2) shall start not from the day on which the return was delivered but from the filing date.

• (7) In sub-paragraph (6) “group” and “small group” have the same meaning as in sections 474(1) and 383 of the Companies Act 2006.

Scope of enquiry

25

• (1) An enquiry into a company tax return extends to anything contained in the return, or required to be contained in the return, including—

• (a) any claim or election included in the return,

• (b) any amount that affects or may affect—

• (i) the tax payable by that company for another accounting period, or

• (ii) the tax liability of another company for any accounting period,

and also extends to consideration of whether to give the company a notice within sub-paragraph (3). But this is subject to the following limitation.

• (2) If the notice of enquiry is given—

• (a) as a result of an amendment by the company of its return, and

• (b) at a time when it is no longer possible to give notice of enquiry under paragraph 24(2) or (3),

the enquiry into the return is limited to matters to which the amendment relates or which are affected by the amendment.

• (3) A notice is within this sub-paragraph if it is—

• (a) a notice under section 184G or 184H of the Taxation of Chargeable Gains Act 1992 (avoidance involving capital losses),

• (b) a notice under section 81(2) of TIOPA 2010 (schemes and arrangements designed to increase relief), or

• (c) a transfer pricing notice under section 168(1) of TIOPA 2010 (provision not at arm's length: medium-sized enterprise), ...

• (d) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Enquiry into return for wrong period

26

• (1) In the case of a company tax return which it appears to an officer of Revenue and Customs —

• (a) is or may be a return for the wrong period, or

• (b) has become a return for the wrong period as a result of a direction under section 11(3) of the Corporation Tax Act 2009 (power of officer of Revenue and Customs to direct which accounting date to be used where company carries on several trades),

the power to enquire into the return includes power to enquire into the period for which the return ought to have been made.

• (2) A return is a “return for the wrong period” in the following cases.

• (3) The first case is where the return is made for a period which is treated in the return as an accounting period, but which is not an accounting period of the company.

• (4) The second case is where the return is made on the basis that there is no accounting period ending in or at the end of the specified period, but there is such an accounting period.

• (5) In relation to a return for the wrong period the references to the filing date in paragraph 24(2) and (3) (period within which notice of enquiry may be given) are to the date that would be the filing date if the period for which the return was made were a period of the kind it is treated as in the return.

• (6) In this paragraph “the specified period” means the period specified in the notice requiring a company tax return.

Notice to produce documents, etc. for purposes of enquiry

27

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Appeal against notice to produce documents, etc

28

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Penalty for failure to produce documents, etc

29

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Amendment of self-assessment during enquiry to prevent loss of tax

30

• (1) If after notice of enquiry has been given and while the enquiry is in progress in relation to a matter an officer of Revenue and Customs forms the opinion—

• (a) that the amount stated in the company’s self-assessment as the amount of tax payable is insufficient, and

• (b) that unless the assessment is immediately amended there is likely to be a loss of tax to the Crown,

he may by notice to the company amend its self-assessment to make good the deficiency so far as it relates to the matter.

• (2) In the case of an enquiry which under paragraph 25(2) is limited to matters arising from an amendment of the return, sub-paragraph (1) above only applies so far as the deficiency is attributable to the amendment.

• (3) An appeal may be brought against an amendment of a company’s self-assessment by an officer of Revenue and Customs under this paragraph.

• (4) Notice of appeal must be given—

• (a) in writing,

• (b) within 30 days after the amendment was notified to the company,

• (c) to the officer of the Board by whom the notice of amendment was given.

• (5) None of the steps mentioned in section 49A(2)(a) to (c) of the Taxes Management Act 1970 may be taken in relation to the appeal before the completion of the enquiry.

• (6) For the purposes of this paragraph, the period during which an enquiry is in progress in relation to any matter is the whole of the period—

• (a) beginning with the day on which notice of enquiry is given, and

• (b) ending with the day on which a partial closure notice is issued in relation to the matter or, if no such notice is issued, a final closure notice is issued.

Amendment of return by company during enquiry

31

• (1) This paragraph applies if a company amends its company tax return at a time when an enquiry into the return is in progress in relation to any matter to which the amendment relates or which is affected by the amendment.

• (2) The amendment does not restrict the scope of the enquiry but may be taken into account (together with any matters arising) in the enquiry.

• (3) So far as the amendment affects—

• (a) the amount stated in the company’s self-assessment as the amount of tax payable, or

• (b) any amount that affects or may affect—

• (i) the tax payable by the company for another accounting period, or

• (ii) the tax liability of another company for any accounting period,

it does not take effect while the enquiry is in progress in relation to any matter to which the amendment relates or which is affected by the amendment.

This does not affect any claim by the company under section 59DA of the Taxes Management Act 1970 (claim for repayment in advance of liability being established).

• (4) An amendment whose effect is deferred under sub-paragraph (3) takes effect as follows—

• (a) if the conclusions in a partial or final closure notice state either—

• (i) that the amendment was not taken into account in the enquiry, or

• (ii) that no amendment of the return is required arising from the enquiry,

the amendment takes effect when a partial closure notice is issued in relation to the matters to which the amendment relates or which are affected by the amendment or, if no such notice is issued, a final closure notice is issued;

• (b) in any other case, the amendment takes effect as part of the amendments made by the closure notice.

• (5) For the purposes of this paragraph the period during which an enquiry is in progress in relation to any matter is the whole of the period—

• (a) beginning with the day on which an officer of Revenue and Customs gives notice of enquiry into the return, and

• (b) ending with the day on which a partial closure notice is issued in relation to the matter or, if no such notice is issued, a final closure notice is issued.

Referral of questions to the tribunal during enquiry

31A

• (1) At any time when an enquiry is in progress in relation to any matter relating to a company’s tax return any question arising in connection with the subject-matter of the enquiry may be referred to the tribunal for ... determination.

• (2) Notice of referral must be given—

• (a) jointly by the company and an officer of Revenue and Customs,

• (b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (c) to the tribunal.

• (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (4) More than one notice of referral may be given under this paragraph in relation to an enquiry.

• (5) For the purposes of this paragraph the period during which an enquiry is in progress in relation to any matter is the whole of the period—

• (a) beginning with the day on which an officer of Revenue and Customs gives notice of enquiry into the return, and

• (b) ending with the day on which a partial closure notice is issued in relation to the matter or, if no such notice is issued, a final closure notice is issued.

Withdrawal of notice of referral

31B

• (1) An officer of Revenue and Customs or the company may withdraw a notice of referral under paragraph 31A ...

• (2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Effect of referral on enquiry

31C

• (1) While proceedings on a referral under paragraph 31A are in progress in relation to an enquiry—

• (a) no partial closure notice relating to the question referred shall be given,

• (aa) no final closure notice shall be given in relation to the enquiry, and

• (b) no application may be made for a direction to give a notice referred to in paragraph (a) or (aa).

• (2) For the purposes of this paragraph proceedings on a referral are in progress where—

• (a) notice of referral has been given,

• (b) the notice has not been withdrawn, and

• (c) the questions referred have not been finally determined.

• (3) For the purposes of sub-paragraph (2)(c) a question referred is finally determined when—

• (a) it has been determined by the tribunal, and

• (b) there is no further possibility of that determination being varied or set aside (disregarding any power to grant permission to appeal out of time).

Effect of determination

31D

• (1) The determination of a question referred to the tribunal under paragraph 31A is binding on the parties to the referral in the same way, and to the same extent, as a decision on a preliminary issue in an appeal.

• (2) The determination shall be taken into account by an officer of Revenue and Customs in reaching his conclusions on the enquiry.

• (3) Any right of appeal under paragraph 30 or 34(3) may not be exercised so as to reopen the question determined except to the extent (if any) that it could be reopened if it had been determined as a preliminary issue in that appeal.

Completion of enquiry

32

• (1) Any matter to which an enquiry relates is completed when an officer of Revenue and Customs informs the company by notice (a “partial closure notice”) that they have completed their enquiries into that matter.

• (1A) An enquiry is completed when an officer of Revenue and Customs informs the company by notice (a “final closure notice”)—

• (a) in a case where no partial closure notice has been given, that they have completed their enquiries, or

• (b) in a case where one or more partial closure notices have been given, that they have completed their remaining enquiries.

• (1B) A partial or final closure notice takes effect when it is issued.

• (2) If an officer of Revenue and Customs concludes in a partial or final closure notice that the return was a return for the wrong period, the closure notice must designate the accounting period for which a return should have been made (specifying the dates on which the period begins and ends).

• (3) If there is more than one accounting period ending in or at the end of the period specified in the notice requiring a return, the closure notice shall only designate the first of those accounting periods for which no return has been delivered.

Paragraph 35 provides for a return to be delivered for any other outstanding accounting period.

• (4) In the Taxes Acts, references to a closure notice under this paragraph are to a partial or final closure notice under this paragraph.

Direction to complete enquiry

33

• (1) The company may apply to the tribunal for a direction that an officer of Revenue and Customs give a partial or final closure notice within a specified period.

• (2) Any such application 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).

• (3) The tribunal shall give a direction unless ... satisfied that an officer of Revenue and Customs has reasonable grounds for not giving a partial or final closure notice within a specified period.

Amendment of return after enquiry

34

• (1) This paragraph applies where a partial or final closure notice is given to a company by an officer.

• (2) The partial or final closure notice must state the officer's conclusions and—

• (a) state that, in the officer's opinion, no amendment is required of the return that was the subject of the enquiry, or

• (b) make the amendments of that return that are required—

• (i) to give effect to the conclusions stated in the notice, and

• (ii) in the case of a return for the wrong period, to make it a return appropriate to the designated period.

• (2A) The officer may by further notice to the company make any amendments of other company tax returns delivered by the company that are required to give effect to the conclusions stated in the partial or final closure notice.

• (3) An appeal may be brought against an amendment of a company's return under sub-paragraph (2) or (2A).

• (4) Notice of appeal must be given—

• (a) in writing,

• (b) within 30 days after the amendment was notified to the company,

• (c) to the officer of the Board by whom the partial or final closure notice was given.

• (5) In this paragraph “the designated period” means the period designated in the partial or final closure notice.

Further return for outstanding period

35

• (1) Where, following an enquiry into a company tax return—

• (a) it is finally determined—

• (i) that the return is a return for the wrong period, and

• (ii) what the period is for which the return should have been made, and

• (b) the effect of the determination is that there is a further period (“the outstanding period") for which a company tax return should have been made under the original notice requiring a return,

then, if there is no such return delivered by the company which can be amended so as to become a return for the outstanding period, the original notice shall be taken to require the company to deliver a return in respect of that period.

• (2) The filing date for such a return for an outstanding period is whichever is the later of—

• (a) the original filing date, and

• (b) the last day of the period of 30 days beginning with the day on which the matters mentioned in sub-paragraph (1)(a) are finally determined.

Part V — Revenue determinations and assessments

Determination of tax payable if no return delivered in response to notice

36

• (1) If no return is delivered in response to a notice requiring a company tax return, an officer of Revenue and Customs may determine to the best of his information and belief the amount of tax payable by the company.

• (2) The power to make a determination under this paragraph becomes exercisable if no return is delivered on or before the following date—

• (a) if the filing date for any return required by the notice can be ascertained, that date;

• (b) if no such date can be ascertained, the later of—

• (i) 18 months from the end of the period specified in the notice, or

• (ii) three months from the day on which the notice was served.

• (3) The accounting period or periods for which a determination may be made are—

• (a) if there is only one accounting period ending in or at the end of the period specified in the notice, that period;

• (b) if there is more than one accounting period ending in or at the end of the period specified in the notice, each of those periods;

• (c) if an officer of Revenue and Customs has insufficient information to identify the accounting periods of the company, such period or periods ending in or at the end of the period specified in the notice as he may determine.

• (4) Notice of a determination under this paragraph must be served on the company, stating the date on which the determination is issued.

• (5) No determination under this paragraph may be made more than 3 years after the day on which the power becomes exercisable.

• (6) If the company shows—

• (a) that there is no accounting period of the company ending in or at the end of the period specified in the notice, or

• (b) that it has delivered a return for the accounting period, or each accounting period, ending in or at the end of the period specified in the notice, or

• (c) that no return is yet due for any such period,

any determination under this paragraph is of no effect.

Determination of tax payable if notice complied with in part

37

• (1) If a notice requiring a company tax return is served on a company and—

• (a) a return is delivered for an accounting period ending in or at the end of the period specified in the notice, but

• (b) there is another period so ending (the “outstanding period") which appears to an officer of Revenue and Customs is or may be an accounting period,

an officer of Revenue and Customs may determine to the best of his information and belief the amount of corporation tax payable by the company for the outstanding period.

• (2) The power to make a determination under this paragraph becomes exercisable—

• (a) if the filing date for the outstanding period can be ascertained and no return is delivered on or before that date;

• (b) if no such date can be ascertained and no return for that period is delivered by the later of—

• (i) 30 months from the end of the period specified in the notice, or

• (ii) three months from the day on which the notice was served.

• (3) Notice of a determination under this paragraph must be served on the company, stating the date on which the determination is issued.

• (4) No determination under this paragraph may be made more than 3 years after the day on which the power first became exercisable.

• (5) If the company shows—

• (a) that the outstanding period is not an accounting period, or

• (b) that it has delivered a return for that period,

any determination under this paragraph is of no effect.

Extent of power to make determination

38

• (1) The power to make a determination under paragraph 36 or 37 includes power to determine—

• (a) any of the amounts mentioned in paragraph 8(1) (calculation of amount of tax payable), and

• (b) any amount forming part of the calculation of any of those amounts.

• (2) Notice of a determination under either of those paragraphs may be accompanied by notice of any determination by an officer of Revenue and Customs relating to the dates on which amounts of tax become due and payable under section 59D or 59E of the Taxes Management Act 1970.

Determination to have effect as self-assessment

39

• (1) A determination under paragraph 36 or 37 has effect for enforcement purposes as if it were a self-assessment by the company.

• (2) In sub-paragraph (1) “for enforcement purposes” means for the purposes of —

• (a) the following Parts of the Taxes Management Act 1970—

Part VA (payment),

Part VI (collection and recovery),

• (b) the provisions of this Schedule imposing tax-related penalties; and

• (c) the provisions of the Corporation Tax Acts enabling unpaid tax assessed on a company to be assessed on other persons.

• (3) For those purposes the period for which the determination is made shall be treated as an accounting period of the company, even though—

• (a) in the case of a determination under paragraph 36, an officer of Revenue and Customs has insufficient information to determine the accounting periods of the company and exercises his power under sub-paragraph (3)(c) of that paragraph, or

• (b) in the case of a determination under paragraph 37, an officer of Revenue and Customs has insufficient information to determine whether the outstanding period is an accounting period.

Determination superseded by actual self-assessment

40

• (1) If after a determination has been made under paragraph 36—

• (a) the company delivers a company tax return for a period ending in or at the end of the period specified in the notice requiring a company tax return, and

• (b) the period is, or is treated in the return as, an accounting period,

the self-assessment included in that return supersedes the determination or, if there is more than one, the determination for the period which is, or most closely approximates to, the period for which the return is made.

• (2) If after a determination has been made under paragraph 37—

• (a) the company delivers a further company tax return for a period ending in or at the end of the period specified in the notice requiring a company tax return, and

• (b) the period is, or is treated in the return as, an accounting period,

the self-assessment included in that return supersedes the determination.

• (3) Sub-paragraphs (1) and (2) do not apply to a return made—

• (a) more than 3 years after the day on which the power to make the determination first became exercisable (see paragraph 36(2) or 37(2)), or

• (b) more than twelve months after the date of the determination,

whichever is the later.

• (4) Where—

• (a) proceedings have been begun for the recovery of any tax charged by a determination under paragraph 36 or 37, and

• (b) before the proceedings are concluded the determination is superseded by a self-assessment,

the proceedings may be continued as if they were proceedings for the recovery of so much of the tax charged by the self-assessment as is due and payable and has not been paid.

• (5) Where—

• (a) action is being taken under Part 1 of Schedule 8 to the Finance (No. 2) Act 2015 (enforcement of deduction from accounts) for the recovery of an amount (“the original amount”) of any tax charged by a determination under paragraph 36 or 37, and

• (b) before that action is concluded, the determination is superseded by a self-assessment,

that action may be continued as if it were action for the purposes of the recovery of so much of the tax charged by the self-assessment as is due and payable, has not been paid and does not exceed the original amount.

Assessment where loss of tax discovered or determination of amount discovered to be incorrect

41

• (1) If an officer of Revenue and Customs discovers as regards an accounting period of a company that—

• (a) an amount which ought to have been assessed to tax has not been assessed, or

• (b) an assessment to tax is or has become insufficient, or

• (c) relief has been given which is or has become excessive,

he may make an assessment (a “discovery assessment") in the amount or further amount which ought in his opinion to be charged in order to make good to the Crown the loss of tax.

• (2) If an officer of Revenue and Customs discovers that a company tax return delivered by a company for an accounting period incorrectly states—

• (a) an amount that affects, or may affect, the tax payable by that company for another accounting period, or

• (b) an amount that affects, or may affect, the tax liability of another company,

he may make a determination (a “discovery determination") of the amount which in his opinion ought to have been stated in the return.

Restrictions on power to make discovery assessment or determination

42

• (1) The power to make—

• (a) a discovery assessment for an accounting period for which the company has delivered a company tax return, or

• (b) a discovery determination,

is only exercisable in the circumstances specified in paragraph 43 or 44 and subject to paragraph 45 below.

• (2) Those restrictions do not apply to an assessment or determination which only gives effect to a discovery determination duly made with respect to an amount stated in another company’s company tax return.

• (2A) Those restrictions, other than the restriction in paragraph 45, do not apply so far as regards any income or chargeable gains of the company in relation to which the company has been given, a notice within sub-paragraph (4) after any enquiries have been completed into the return (so far as relating to the matters to which the notice relates).

• (3) Any objection to a discovery assessment or determination on the ground that those paragraphs have not been complied with can only be made on an appeal against the assessment or determination.

• (4) A notice is within this sub-paragraph if it is—

• (a) a notice under section 184G or 184H of the Taxation of Chargeable Gains Act 1992 (avoidance involving capital losses), or

• (b) a notice under section 81(2) of TIOPA 2010 (schemes and arrangements designed to increase relief), ...

• (c) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Loss of tax brought about carelessly or deliberately

43

A discovery assessment for an accounting period for which the company has delivered a company tax return, or a discovery determination, may be made if the situation mentioned in paragraph 41(1) or (2) was brought about carelessly or deliberately by—

• (a) the company, or

• (b) a person acting on behalf of the company, or

• (c) a person who was a partner of the company at the relevant time.

Situation not disclosed by return or related documents etc.

44

• (1) A discovery assessment for an accounting period for which the company has delivered a company tax return, or a discovery determination, may be made if at the time when an officer of Revenue and Customs—

• (a) ceased to be entitled to give a notice of enquiry into the return, or

• (b) in a case where a notice of enquiry into the return was given—

• (i) issued a partial closure notice as regards a matter to which the situation mentioned in paragraph 41(1) or (2) relates, or

• (ii) if no such partial closure notice was issued, issued a final closure notice,

he could not have been reasonably expected, on the basis of the information made available to him before that time, to be aware of the situation mentioned in paragraph 41(1) or (2).

• (2) For this purpose information is regarded as made available to an officer of Revenue and Customs if—

• (a) it is contained in a relevant return by the company or in documents accompanying any such return, or

• (b) it is contained in a relevant claim made by the company or in any accounts, statements or documents accompanying any such claim, or

• (c) it is contained in any documents, accounts or information produced or provided by the company to an officer of Revenue and Customs for the purposes of an enquiry into any such return or claim, or

• (d) it is information the existence of which, and the relevance of which as regards the situation mentioned in paragraph 41(1) or (2)—

• (i) could reasonably be expected to be inferred by an officer of Revenue and Customs from information falling within paragraphs (a) to (c) above, or

• (ii) are notified in writing to an officer of Revenue and Customs by the company or a person acting on its behalf.

• (3) In sub-paragraph (2)—

• “relevant return” means the company’s company tax return for the period in question or either of the two immediately preceding accounting periods, and

• “relevant claim” means a claim made by or on behalf of the company as regards the period in question or an application under section 751A of the Taxes Act 1988 made by or on behalf of the company which affects the company's tax return for the period in question.

Return made in accordance with prevailing practice

45

No discovery assessment for an accounting period for which the company has delivered a company tax return, or discovery determination, may be made if—

• (a) the situation mentioned in paragraph 41(1) or (2) is attributable to a mistake in the return as to the basis on which the company’s liability ought to have been computed, and

• (b) the return was in fact made on the basis or in accordance with the practice generally prevailing at the time when it was made.

General time limits for assessments

46

• (1) Subject to any provision of the Taxes Acts allowing a longer period in any particular class of case no assessment may be made more than 4 years after the end of the accounting period to which it relates.

• (2) An assessment in a case involving a loss of tax brought about carelessly by the company (or a related person) may be made at any time not more than 6 years after the end of the accounting period to which it relates (subject to sub-paragraph (2A) and to any other provision of the Taxes Acts allowing a longer period).

• (2A) An assessment in a case involving a loss of tax—

• (a) brought about deliberately by the company (or a related person),

• (b) attributable to a failure by the company to comply with an obligation under paragraph 2, ...

• (c) attributable to arrangements in respect of which the company has failed to comply with an obligation under section 309, 310 or 313 of the Finance Act 2004 (obligation of parties to tax avoidance schemes to provide information to Her Majesty's Revenue and Customs), or

• (d) attributable to arrangements which were expected to give rise to a tax advantage in respect of which the company was under an obligation to notify the Commissioners for Her Majesty's Revenue and Customs under section 253 of the Finance Act 2014 (duty to notify Commissioners of promoter reference number) but failed to do so,

may be made at any time not more than 20 years after the end of the accounting period to which it relates (subject to any provision of the Taxes Acts allowing a longer period).

• (2B) In this paragraph “related person”, in relation to a company, means—

• (a) a person acting on behalf of the company, or

• (b) a person who was a partner of the company at the relevant time.

• (3) Any objection to the making of an assessment on the ground that the time limit for making it has expired can only be made on an appeal against the assessment.

Assessment procedure

47

• (1) Notice of an assessment to tax on a company must be served on the company stating—

• (a) the date on which the notice is issued, and

• (b) the time within which any appeal against the assessment may be made.

• (2) After that notice has been served on the company, the assessment may not be altered except in accordance with the express provisions of the Taxes Acts.

Appeal against assessment

48

• (1) An appeal may be brought against any assessment to tax on a company which is not a self-assessment.

• (2) Notice of appeal must be given—

• (a) in writing,

• (b) within 30 days after notice of the assessment was issued,

• (c) to the officer of the Board by whom the notice of the assessment was given.

Application of provisions to discovery determinations

49

The provisions of paragraphs 46 to 48 (assessments: general provisions as to time limits, procedure and appeals) apply to a discovery determination as they apply to an assessment.

Transfer pricing records: carelessness

49A

• (1) This paragraph applies where—

• (a) the situation mentioned in paragraph 41(1) or (2) has been brought about by a person within any of paragraphs (a) to (c) of paragraph 43 (“P”) as regards a relevant accounting period of a company,

• (b) the situation relates to the calculation of profits or losses in accordance with Part 4 of TIOPA 2010 (transfer pricing) for the purposes of that period, and

• (c) the company has failed to comply, in relation to specified relevant transfer pricing records that relate to the calculation, with either or both of—

• (i) paragraph 21 (duty to keep and preserve records), and

• (ii) an information notice (within the meaning of Schedule 36 to the Finance Act 2008 (information and inspection powers)).

• (2) It is to be presumed for the purposes of this Part of this Schedule that the situation mentioned in paragraph 41(1) or (2) was brought about carelessly by P, unless—

• (a) the situation was brought about deliberately by P, or

• (b) the company satisfies HMRC or (on an appeal notified to the tribunal) the tribunal that P took reasonable care to avoid the situation.

• (3) For the purposes of this paragraph—

• (a) “relevant accounting period of a company” means an accounting period in respect of which—

• (i) the company, together with one or more other enterprises, constitutes an MNE Group within the meaning of the Taxes (Base Erosion and Profit Shifting) (Country-by-Country Reporting) Regulations 2016 (S.I. 2016/237) (see regulation 2(3) of those Regulations), and

• (ii) the MNE Group meets the threshold requirement within the meaning of those Regulations (see regulations 3(2) to (4) of those Regulations);

• (b) records are “specified relevant transfer pricing records” if—

• (i) they are relevant transfer pricing records specified, or of a description specified, in regulations under paragraph 21 (duties to keep and preserve records), and

• (ii) the company is required to keep and preserve those records under that paragraph.

Part VI — Overpaid tax, excessive assessments or repayments, etc

Relief in case of double assessment

50

• (1) A company which believes it has been assessed to tax more than once for the same cause and for the same accounting period may make a claim for relief—

• (a) by notice in writing,

• (b) given to the Board.

• (2) If on a claim being made the Board are satisfied that the company has been assessed to tax more than once for the same cause and for the same accounting period, they shall amend the assessment or assessments concerned, or give relief by way of discharge or repayment of tax or otherwise, so as to eliminate the double charge.

• (3) An appeal may be brought against the Board’s decision on a claim for relief under this paragraph.

Claim for relief for overpaid tax etc

51

• (1) This paragraph applies where—

• (a) a person has paid an amount by way of tax but believes that the tax was not due, or

• (b) a person has been assessed as liable to pay an amount by way of tax, or there has been a determination or direction to that effect, but the person believes that the tax is not due.

• (2) The person may make a claim to the Commissioners for Her Majesty's Revenue and Customs for repayment or discharge of the amount.

• (3) Paragraph 51A makes provision about cases in which the Commissioners for Her Majesty's Revenue and Customs are not liable to give effect to a claim under this paragraph.

• (4) The following make further provision about making and giving effect to claims under this paragraph—

• (a) paragraphs 51B to 51F and Part 7 of this Schedule, and

• (b) Schedule 1A to the Taxes Management Act 1970 (which is applied by that Part).

• (5) Paragraph 51G makes provision about the application of this paragraph and paragraphs 51A to 51F to amounts paid under contract settlements.

• (6) The Commissioners for Her Majesty's Revenue and Customs are not liable to give relief in respect of a case described in sub-paragraph (1)(a) or (b) except as provided—

• (a) by this Schedule and Schedule 1A to the Taxes Management Act 1970 (following a claim under this paragraph), or

• (b) by or under another provision of the Corporation Tax Acts.

• (7) For the purposes of this paragraph and paragraphs 51A to 51G, an amount paid by one person on behalf of another is treated as paid by the other person.

Cases in which Commissioners not liable to give effect to a claim

51A

• (1) The Commissioners for Her Majesty's Revenue and Customs are not liable to give effect to a claim under paragraph 51 if or to the extent that the claim falls within a case described in this paragraph (see also paragraphs 51BA and 51C(5)).

• (2) Case A is where the amount paid, or liable to be paid, is excessive by reason of—

• (a) a mistake in a claim, election or a notice,

• (b) a mistake consisting of making or giving, or failing to make or give, a claim, election or notice,

• (c) a mistake in allocating expenditure to a pool for the purposes of the Capital Allowances Act or a mistake consisting of making, or failing to make, such an allocation, or

• (d) a mistake in bringing a disposal value into account for the purposes of that Act or a mistake consisting of bringing, or failing to bring, such a value into account.

• (3) Case B is where the claimant is or will be able to seek relief by taking other steps under the Corporation Tax Acts.

• (4) Case C is where the claimant—

• (a) could have sought relief by taking such steps within a period that has now expired, and

• (b) knew, or ought reasonably to have known, before the end of that period that such relief was available.

• (5) Case D is where the claim is made on grounds that—

• (a) have been put to a court or tribunal in the course of an appeal by the claimant relating to the amount paid or liable to be paid, or

• (b) have been put to Her Majesty's Revenue and Customs in the course of an appeal by the claimant relating to that amount that is treated as having been determined by a tribunal (by virtue of section 54 of the Taxes Management Act 1970 (settling of appeals by agreement)).

• (6) Case E is where the claimant knew, or ought reasonably to have known, of the grounds for the claim before the latest of the following—

• (a) the date on which an appeal by the claimant relating to the amount paid, or liable to be paid, in the course of which the ground could have been put forward (a “relevant appeal”) was determined by a court or tribunal (or is treated as having been so determined),

• (b) the date on which the claimant withdrew a relevant appeal to a court or tribunal, and

• (c) the end of the period in which the claimant was entitled to make a relevant appeal to a court or tribunal.

• (7) Case F is where the amount in question was paid or is liable to be paid—

• (a) in consequence of proceedings enforcing the payment of that amount brought against the claimant by Her Majesty's Revenue and Customs, or

• (b) in accordance with an agreement between the claimant and Her Majesty's Revenue and Customs settling such proceedings.

• (8) Case G is where—

• (a) the amount paid, or liable to be paid, is excessive by reason of a mistake in calculating the claimant's liability to corporation tax, and

• (b) liability was calculated in accordance with the practice generally prevailing at the time.

• (9) Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law.

• (10) For the purposes of sub-paragraph (9), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—

• (a) the provisions relating to the free movement of goods, persons, services and capital in Titles II and IV of Part 3 of the Treaty on the Functioning of the European Union, or

• (b) the provisions of any subsequent treaty replacing the provisions mentioned in paragraph (a).

Making a claim

51B

• (1) A claim under paragraph 51 may not be made more than 4 years after the end of the relevant accounting period.

• (2) In relation to a claim made in reliance on paragraph 51(1)(a), the relevant accounting period is—

• (a) where the amount paid, or liable to be paid, is excessive by reason of a mistake in a company tax return or returns, the accounting period to which the return (or, if more than one, the first return) relates, and

• (b) otherwise, the accounting period in respect of which the amount was paid.

• (3) In relation to a claim made in reliance on paragraph 51(1)(b), the relevant accounting period is—

• (a) where the amount liable to be paid is excessive by reason of a mistake in a company tax return or returns, the accounting period to which the return (or, if more than one, the first return) relates, and

• (b) otherwise, the accounting period to which the assessment, determination or direction relates.

• (4) A claim under paragraph 51 may not be made by being included in a company tax return.

• (5) Sub-paragraph (1) is subject to paragraph 51BA.

Determinations under paragraphs 36 and 37: special rules

51BA

• (1) This paragraph applies where—

• (a) a determination has been made under paragraph 36 or 37 of an amount that a person is liable to pay by way of tax, but the person believes the tax is not due or, if it has been paid, was not due,

• (b) relief would be available under paragraph 51 but for the fact that—

• (i) the claim falls within Case C (see paragraph 51A(4)),

• (ii) the claim falls within Case F(a) (see paragraph 51A(7)(a)), or

• (iii) more than 4 years have elapsed since the end of the relevant accounting period (see paragraph 51B(1)), and

• (c) if the claim falls within Case F(a), the person was neither present nor legally represented during the enforcement proceedings in question.

• (2) A claim under paragraph 51 for repayment or discharge of the amount may be made, and effect given to it, despite paragraph 51A(4), paragraph 51A(7)(a) or paragraph 51B(1), as the case may be.

• (3) But the Commissioners for Her Majesty’s Revenue and Customs are not liable to give effect to a claim made in reliance on this paragraph unless conditions A, B and C are met.

• (4) Condition A is that in the opinion of the Commissioners for Her Majesty’s Revenue and Customs it would be unconscionable for the Commissioners for Her Majesty’s Revenue and Customs to seek to recover the amount (or to withhold repayment of it, if it has already been paid).

• (5) Condition B is that the person’s affairs (as respects matters concerning the Commissioners for Her Majesty’s Revenue and Customs) are otherwise up to date or arrangements have been put in place, to the satisfaction of the Commissioners for Her Majesty’s Revenue and Customs, to bring them up to date so far as possible.

• (6) Condition C is that either—

• (a) the person has not relied on this paragraph on a previous occasion (whether or not in respect of the same determination), or

• (b) the person has done so, but in the exceptional circumstances of the case should be allowed to do so again on the present occasion.

• (7) For the purposes of sub-paragraph (6)—

• (a) a person has relied on this paragraph on a previous occasion if the person has made a claim (or a composite set of claims involving one or more determinations and accounting periods) in reliance on this paragraph on a previous occasion, and

• (b) it does not matter whether that claim (or set of claims) succeeded.

• (8) A claim made in reliance on this paragraph must include (in addition to anything required by Schedule 1A to the Taxes Management Act 1970) such information and documentation as is reasonably required for the purpose of determining whether conditions A, B and C are met.

The claimant: one person accountable for amounts payable by another

51C

• (1) Sub-paragraph (2) applies where a person (“P”) is accountable to the Commissioners for Her Majesty's Revenue and Customs under a relevant enactment for an amount that has been or is to be set off against a liability of another person (“T”) under a relevant enactment.

• (2) A claim under paragraph 51 in respect of the amount may be made only by T.

• (3) Sub-paragraph (4) applies where—

• (a) a person (“P”) has paid an amount described in sub-paragraph (1) in the belief that P was accountable to the Commissioners for the amount under a relevant enactment, but

• (b) P was not so accountable.

• (4) A claim under paragraph 51 in respect of the amount may be made only by P.

• (5) The Commissioners for Her Majesty's Revenue and Customs are not liable to give effect to a claim under sub-paragraph (4) if or to the extent that the amount has been repaid to T or set against amounts payable to the Commissioners by T.

• (6) “Relevant enactment” means—

• (a) Chapter 3 of Part 3 of the Finance Act 2004 or regulations under that Chapter (construction industry scheme), or

• (b) any other provision of or made under the Taxes Acts.

The claimant: partnerships

51D

• (1) This paragraph applies where—

• (a) a trade, profession or business is carried on by two or more persons in partnership,

• (b) an amount is paid, or liable to be paid, by one or more of those persons in accordance with a self-assessment, and

• (c) the amount is excessive by reason of a mistake in a partnership return.

• (2) A claim under paragraph 51 in respect of the amount—

• (a) may be made by the relevant partner nominated to make the claim by all of the relevant partners, and

• (b) may not be made by any other person.

• (3) In relation to such a claim, references in paragraphs 51A to 51F to the claimant are to any of the relevant partners.

• (4) “Relevant partner” means—

• (a) a person who was a partner in the partnership at any time during the period in respect of which the partnership return was made, or

• (b) the personal representative of such a person.

Assessment of claimant in connection with claim

51E

• (1) This paragraph applies where—

• (a) a claim is made under paragraph 51,

• (b) the grounds for giving effect to the claim also provide grounds for a discovery assessment or discovery determination on the claimant in respect of any accounting period, and

• (c) such an assessment or determination could be made but for a relevant restriction.

• (2) The following are relevant restrictions—

• (a) the restrictions in paragraphs 42 to 45, and

• (b) the expiry of a time limit for making a discovery assessment or discovery determination.

• (3) Where this paragraph applies—

• (a) the relevant restrictions are to be disregarded, and

• (b) the discovery assessment or discovery determination is not out of time if it is made before the final determination of the claim.

• (4) 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).

Amendment of partnership return etc in connection with claim

51F

• (1) This paragraph applies where—

• (a) a claim is made under paragraph 51,

• (b) the claimant is one of two or more persons carrying on a trade, profession or business in partnership,

• (c) the grounds for giving effect to the claim also provide grounds for amending, under section 30B(1) of the Taxes Management Act 1970 (discovery of loss of tax from partnership), a return made by the partnership or any of the partners in respect of any period, and

• (d) such an amendment could be made but for a relevant restriction.

• (2) The following are relevant restrictions—

• (a) the conditions in section 30B(4) to (6) of the Taxes Management Act 1970, and

• (b) the expiry of a time limit for making an assessment under that section.

• (3) Where this paragraph applies—

• (a) the relevant conditions are to be disregarded, and

• (b) the amendment is not out of time if it is made before the final determination of the claim.

• (4) 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

51G

• (1) In paragraph 51(1)(a) the reference to an amount paid by a company by way of tax 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) In relation to a claim under paragraph 51 in respect of that amount—

• (a) the references to the claimant in paragraph 51A(5) to (7) (Cases D, E and F) have effect as if they included the taxpayer,

• (b) the reference to the claimant in paragraph 51A(8) (Case G) has effect as if it were a reference to the taxpayer,

• (c) the references to the claimant in paragraphs 51E(1)(b) and 51F(1)(b) have effect as if they were references to the taxpayer, and

• (d) references to tax in Schedule 1A to the Taxes Management Act 1970 (as it applies to a claim under this Part of this Schedule) include such an amount.

• (4) Sub-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 or discovery determination on the taxpayer in respect of any chargeable period.

• (5) The Commissioners for Her Majesty's Revenue and Customs may set any amount repayable to the payer by virtue of the claim against any amount payable by the taxpayer by virtue of the assessment or determination.

• (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 person's liability to make a payment to the Commissioners for Her Majesty's Revenue and Customs under or by virtue of an enactment.

Recovery of excessive repayments etc

52

• (1) The provisions of paragraphs 41 to 48 relating to discovery assessments apply to an amount to which this sub-paragraph applies as if it were unpaid tax, unless—

• (a) it is assessable under those provisions apart from this paragraph, or

• (b) it is recoverable under section 826(8A) of the Taxes Act 1988 (interest overpaid which is recoverable in same way as interest charged).

• (2) Sub-paragraph (1) applies to an amount paid to a company by way of—

• (a) repayment of tax (or income tax) ... ,

• (b) repayment supplement under section 825 of the Taxes Act 1988,

• (bza) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ba) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bb) land remediation tax credit or life assurance company tax credit under Part 14 of the Corporation Tax Act 2009, or

• (bc) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bd) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (be) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bf) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bg) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bh) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (bi) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (c) interest paid under section 826 of the Taxes Act 1988,

to the extent that it ought not to have been paid.

• (2A) The provisions of paragraphs 41 and 45 to 48 relating to discovery assessments apply to an amount paid to a company by way of—

• (a) first-year tax credit under Schedule A1 to the Capital Allowances Act;

• (b) R&D expenditure credit under Chapter 1A of Part 13 of the Corporation Tax Act 2009;

• (c) R&D tax credit under Chapter 2 or 7 of Part 13 of that Act, or

• (d) creative sector credit,

but only to the extent that the company was not, or is no longer, entitled to the credit.

• (2B) In this paragraph, “creative sector credit” means—

• (a) audiovisual expenditure credit or video game expenditure credit under Chapter 3 of Part 14A of the Corporation Tax Act 2009,

• (b) film tax credit under Part 15 of that Act,

• (c) television tax credit under Part 15A of that Act,

• (d) video game credit under Part 15B of that Act,

• (e) theatre tax credit under Part 15C of that Act,

• (f) orchestra tax credit under Part 15D of that Act, or

• (g) museums and galleries exhibition credit under Part 15E of that Act.

• (3) For the purposes of this paragraph—

• (a) an amount is regarded as paid if it is allowed by way of set-off, and

• (b) an amount is regarded as a repayment if it was intended as repayment but exceeds the amount paid by the company.

• (4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (5) An assessment to recover—

• (a) an amount of tax repaid to a company in respect of an accounting period, or interest on any such repayment,

• (aa) an amount of R&D expenditure credit paid to a company for an accounting period,

• (ab) an amount of R&D tax credit paid to a company for an accounting period,

• (ac) an amount of land remediation tax credit or life assurance company tax credit paid to a company for an accounting period, or

• (ad) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ae) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (af) an amount of first-year tax credit under Schedule A1 to the Capital Allowances Act paid to a company for an accounting period,

• (ag) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ah) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ai) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (aj) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (ak) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

• (al) an amount of creative sector credit paid to a company for an accounting period, or

• (b) an amount of income tax repaid to a company in respect of a payment received by the company in an accounting period, or interest on any such repayment,

shall be treated as an assessment to tax for that accounting period.

• (6) The sum assessed shall carry interest at the prescribed rate for the purposes of section 87A of the Taxes Management Act 1970 (interest on overdue corporation tax, etc.) from the date when the payment being recovered was made until payment.

Time limit for recovery of excessive repayments, etc.

53

• (1) An assessment made by virtue of paragraph 52 is not out of time under paragraph 46(1) (general 4 year time limit for assessments) if it is made—

• (a) before the end of the accounting period following that in which the amount assessed was paid, or

• (b) if later, before the end of the period of three months beginning with the day on which an officer of Revenue and Customs completes an enquiry into a relevant company tax return by the company concerned.

• (2) Sub-paragraph (1) above is without prejudice to paragraph 46(2) and (2A) (time limit for assessment in case of loss of tax brought about carelessly or deliberately).

Part VII — General provisions as to claims and elections

Claims must be quantified

54

A claim under any provision of the Corporation Tax Acts for a relief, an allowance or a repayment of tax must be for an amount which is quantified at the time when the claim is made.

General time limit for making claims

55

Subject to any provision prescribing a longer or shorter period, a claim for relief under any provision of the Corporation Tax Acts must be made within 4 years from the end of the accounting period to which it relates.

Supplementary claim or election

56

A company which has made a claim or election under any provision of the Corporation Tax Acts (by including it in a return or otherwise) and subsequently discovers that a mistake has been made in it may make a supplementary claim or election within the time allowed for making the original claim or election.

Claims or elections affecting a single accounting period

57

• (1) This paragraph applies to a claim or election for tax purposes which affects only one accounting period (“the relevant accounting period").

This is subject to sub-paragraphs (1A) to (1C).

• (1A) This paragraph does not apply to a claim by a company for repayment of income tax treated as having been paid by virtue of—

• (a) section 471 of the Corporation Tax Act 2010 (gifts qualifying for gift aid relief: charitable companies),

• (b) section 475 of that Act (gifts qualifying for gift aid relief: eligible bodies), or

• (c) section 661D of that Act (gifts qualifying for gift aid relief: community amateur sports clubs).

• (1B) This paragraph also does not apply to a claim by a company for repayment of income tax deducted at source from income which is exempt from tax by virtue of—

• (a) section 486 of the Corporation Tax Act 2010 (investment income and non-trading profits from loan relationships),

• (b) section 487 of that Act (public revenue dividends),

• (c) section 488 of that Act (certain miscellaneous income),

• (d) section 489 of that Act (income from estates in administration), or

• (e) section 664 of that Act (interest and gift aid income: community amateur sports clubs).

• (1C) This paragraph also does not apply to a claim by a company for an amount to be exempt from tax by virtue of—