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HMRC internal manual

Compliance Operational Guidance

HM Revenue & Customs
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Supporting Guidance: employer compliance: guidance by subject: settlement: direction under regulation 72F: regulation 80 determinations

If the employer does not agree that a PAYE failure has occurred, or is reluctant to sign a ‘trigger’ letter accepting the liability, you will have to issue a Regulation 80 determination.

  • Unless a direction under Reg 72F has already been issued the determination should be issued for the gross liability and,
  • any credit for a direction under Reg 72F should only be given when the determination is final and conclusive.

You will need to

  • advise the team issuing the Reg 80 determination that a direction under Reg 72F may be appropriate but you will only be able to issue when the appeal period has elapsed and/or the determination is final and conclusive
  • ask them to stand over the determination pending further instructions
  • advise the employer that a direction under Reg 72F will be considered once the determination becomes final and conclusive

Once the determination is final and conclusive, submit the direction notices to the Authorising Team in accordance with COG915305.

When the appeal period for the Reg 72F direction has elapsed and the direction is final and conclusive, ask the Reg 80 team to amend the Reg 80 determination by giving credit for the amount directed and remove the stand over signal.

If you subsequently find that a direction is not appropriate remember to remove the stand over signal via SAFE.

What if a direction has already been issued?

If a direction under Reg 72F has already been issued because

  • the employer/contractor signed a trigger letter and
  • you were expecting to settle by contract settlement but
  • the employer/contractor refuses to sign a Letter of Offer

Regulation 80 determinations will have to be issued for the net tax liability because a Regulation 80 determination cannot include tax directed under Reg 72F (see Regulation 80(3A) IT(PAYE) Regulations 2003).

The Reg 80 team will show the amount directed as a separate entry in column 6 (tax paid) of the Regulation 80 determination 380 set.

Note: If you do have to raise a Reg 80 determination after a Reg 72F direction has been issued you should not do so until either the 30 day appeal period for the Reg 72F direction has expired or any employee appeal against the direction has been settled. This will avoid the need to amend the Reg 80 determination.

Note: Where a Regulation 80 determination has been issued and is under appeal, the employer can agree to a contract settlement at any time.