Corporation Tax: Banking Surcharge (Information) Regulations 2016
Published 12 May 2016
© Crown copyright 2016
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Who is likely to be affected
Banking companies and any non-banking companies responsible for making Corporation Tax (CT) surcharge payments where a banking company is part of a group payment arrangement.
General description of the measure
The regulations set out the detailed payment information HM Revenue and Customs (HMRC) require in respect of payments of a bank CT surcharge.
Policy objective
The bank CT surcharge is paid alongside a company’s CT liability. The surcharge payment information will allow HMRC to separate out surcharge payments from general CT.
Background to the measure
HMRC monitors tax receipts to model and provide forecasts of future tax receipts for the public finances and wants to ensure the data is as accurate as possible. This information is used to advise ministers and to inform the Office for Budget Responsibility whose forecasts of future tax receipts include a separate entry for the bank CT surcharge.
Companies who make bank CT surcharge payments are already required to notify HMRC each time they make a bank CT surcharge payment, but this information will not always be sufficient for HMRC to quickly and accurately determine the monthly bank CT surcharge receipts. In particular, the bank CT surcharge payment may be part of a larger payment including CT and bank levy and may be met wholly or in part by reallocation of sums previously paid in respect of any of these taxes.
Detailed proposal
Operative date
The regulations come into force on 1 June 2016.
Current law
Current law on information to be provided in respect of payments of surcharge is contained in section 269DM of Corporation Tax Act (CTA) 2010 and section 371UBA of Taxation (International and Other Provisions) Act 2010 (TIOPA 2010).
Proposed revisions
Companies will be asked to provide the following additional information when they notify a payment which includes CT surcharge:
- name and unique tax reference (UTR) of company making the payment
- amount of CT surcharge or Controlled Foreign Companies (CFC) surcharge being paid
- accounting period to which it relates
- reference under which the payment is being made
- expected date of payment
Where any of the amount being paid is to be met way of reallocation:
- the amount that is to be met by direct payment
- the amount that is to be met by reallocation
For each sum to be reallocated against the payment due:
- the amount to be reallocated
- the date the payment to be reallocated was made
- the accounting period to which it relates
- the reference under which the payment was made
- whether the payment being reallocated is CT, CT Surcharge, Bank Levy or other (specify)
Summary of impacts
Exchequer impact (£m)
| 2016 to 2017 | 2017 to 2018 | 2018 to 2019 | 2019 to 2020 | 2020 to 2021 |
|---|---|---|---|---|
| nil | nil | nil | nil | nil |
This measure is not expected to have an Exchequer impact.
Economic impact
This measure is not expected to have any significant macroeconomic impacts.
Impact on individuals, households and families
This measure concerns incorporated businesses. It has no direct impact on individuals or households and is not expected to impact on family formation, stability or breakdown.
Equalities impacts
This measure is not expected to impact on any of the identified diversity groupings.
Impact on business including civil society organisations
This measure is expected to have a negligible impact on businesses and civil society organisations.
An estimated 100 companies make surcharge payments, and they are already expected to provide this information to ensure payments are correctly allocated against surcharge liabilities, without the change this may require more than one exchange of information. HMRC expect these businesses to incur a negligible one-off cost associated with familiarisation with the regulations. There may be negligible on-going savings to business as they will only provide this information once.
There is no impact on civil society organisations or on small and micro businesses.
Operational impact (£m) (HMRC or other)
This measure is not expected to have any significant operational impacts. There will be a small need for manual handling of this information.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
This measure will be kept under review through communication with affected taxpayer groups
Further advice
If you have any questions about this change, please contact Ursula Crosbie on Telephone: 03000 589086 or email: ursula.crosbie@hmrc.gsi.gov.uk.
Anthony Fawcett on Telephone: 03000 585911 or email: anthony.c.fawcett@hmrc.gsi.gov.uk.
Declaration
David Gauke MP, Financial Secretary to the Treasury, has read this tax information and impact note and is satisfied that, given the available evidence, it represents a reasonable view of the likely costs, benefits and impacts of the measure.