Statement of Practice 9 (1992)
Published 5 April 1992
© Crown copyright 1992
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In cases where no statutory discretion is given to The Commissioners for Her Majesty’s Revenue and Customs (HMRC) to extend a time limit for a claim or election, it must be assumed that Parliament’s intention is that the limit should be applied strictly. The number of cases in which it would be appropriate to exercise discretion under the Commissioners for HMRC powers of care and management (provided in the Taxes Management Act 1970) is correspondingly limited.
Every such case has to be considered on its own merits, and in the light of the factors relevant to the circumstances in which the claim was made late. However, there would be a presumption in favour of admitting an election under section 113(2) Income and Corporation Taxes Act 1988 which is made as soon as is reasonably possible in all the circumstances, but after the statutory time limit has expired, if the reason for the late election being late was one of the following:
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some relevant and uncorrected error on the part of HMRC has had the effect of misleading the partners or their agent about whether the requirements of the legislation had been met or
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at a crucial time, one of the required signatories was not available for unforeseeable reasons (eg, because of serious illness) or the agent of a signatory was similarly not available and there was no one else who could reasonably be expected to stand in the agent’s shoes or
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there was some other difficulty about obtaining all the required signatures to the election within the time limit, and HMRC had, before the time limit expired, both been clearly notified that each of the signatories had individually decided to make an election and been given the reasons why the election could not be made within the time limit
The Commissioners for HMRC will not admit elections if they were made after the expiry of the time limit because of oversight or negligence on the part of a partner or their agent or because one of the parties to the election temporarily refused to sign it or because there was a deliberate decision to delay the making of the election because its effect on the taxation liabilities of the relevant parties was not clear by the time the time limit expired.
Note: this statement ceases to be relevant for tax years 1997 to 1998 onwards but continues to apply, where appropriate, for 1996 to 1997 and earlier years.