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HMRC internal manual

Compliance Handbook

From
HM Revenue & Customs
Updated
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Assessing Time limits: Overview

Before the creation of HMRC there were various time limits across the tax regimes for

  • assessing taxes and
  • making claims to relief and repayment.

Aligning these time limits where possible reduces compliance costs for customers and makes our compliance checks easier.

There are two different types of limit

  • how far back we can assess, and
  • how long we have to make an assessment.

The new time limits do not affect the existing rules on how long we have to make an assessment.

New time limits came into effect on

  • 1 April 2009 for VAT, although there are transitional provisions,
  • 1 April 2010 for direct taxes (income tax, capital gains tax and corporation tax) and insurance premium tax, aggregates levy, climate change levy and landfill tax, although there are transitional provisions, and
  • 1 April 2011 for stamp duty land tax, stamp duty reserve tax, petroleum revenue tax and excise duty. The time limits also apply to proceedings to recover inheritance tax from this date, see CH51250.

The new time limits apply to assessments for income tax, capital gains tax, corporation tax, VAT, insurance premium tax, stamp duty land tax, stamp duty reserve tax, petroleum revenue tax, aggregates levy, climate change levy, landfill tax and excise duty that are made after these dates regardless of the period to which the assessment relates.

The new time limits apply to most claims. There are different time limits for some direct tax claims and for most excise duties claims, except those for overpaid duty. This guidance provides details of the time limits that apply for making assessments and determinations and for taking proceedings to recover inheritance tax. It does not cover the time limits for claims. You should refer to the specific guidance for each type of claim for details about the appropriate time limits.

The tables at CH56000+ give a full summary of the time limits for assessments and determinations.

We can make an assessment outside the normal time limit, see CH53100. We will do this, for example, where tax has been lost or too much has been repaid because of the careless or deliberate behaviour of the person or another person acting on their behalf.

  • Where tax has been lost or too much has been repaid because of careless behaviour we can make an assessment within 6 years of the end of the relevant tax period. This applies to income tax, capital gains tax, corporation tax, inheritance tax proceedings (where an IHT account has been delivered and payment made and accepted in full satisfaction of the tax due), stamp duty land tax, stamp duty reserve tax and petroleum revenue tax only.
  • Where tax has been lost or too much has been repaid because of deliberate behaviour we can make an assessment within 20 years of the end of the relevant tax period. This applies to all the taxes listed in CH51200. In addition, for inheritance tax where no IHT account has been delivered, the time limit for recovering tax is 20 years from the relevant date, see CH51700, unless the loss of tax is brought about deliberately when there remains no time limit.

There is more detail about normal and extended time limits at CH53100, CH52000+, CH53000+ and in the tables at CH56000+.

Where we

  • make a discovery assessment for income tax, capital gains tax, corporation tax, stamp duty land tax or stamp duty reserve tax, or
  • amend a return in an SA enquiry closure notice, or
  • amend a return for another accounting period as a consequence of a CTSA enquiry closure notice, or
  • amend a return in a stamp duty land tax enquiry closure notice,

the person may be able to make various consequential claims and elections that otherwise would have been out of time. More detail is at CH55100. There are no consequential claims for VAT, insurance premium tax, aggregates levy, climate change levy, landfill tax, petroleum revenue tax or excise duty.