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HMRC internal manual

COTAX Manual

HM Revenue & Customs
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Payments: group payment arrangements: introduction

Group Payment Arrangements (GPAs) are a customer service for groups of large companies to help them deal efficiently with payments to HMRC.

HMRC enters into an arrangement under which one company pays the total liabilities of all or some of the companies in a group for specified APs. At least one of the companies should be, or expect to be, a Quarterly Instalment Payer.

Groups entering into a GPA make a contract with HMRC under which the Nominated Company pays the amounts due. It then apportions those payments between the participating companies once there is a self assessment or Revenue Determination for each member of the arrangement. The Nominated Company is not responsible for the actual tax liability of each company.

You can see the Group Payment Arrangement Indicator using Function DAPD (Display Accounting Period Details). Where the indicator is set to G, the record is a Group Payment Record (GPR). See COM96030 for information on the GPR.

If the indicator is set to P, the company is a participator in a GPA for the AP displayed and the GPR UTR is also displayed.

A GPA applies to a Group Payment Period (GPP) or series of GPPs for which the group, and specifically the Nominated Company, draws up its accounts. The arrangement applies automatically to subsequent GPPs unless and until the arrangement is terminated.

A GPP has a status of Open, Closed, Cancelled or Cleared. You can see the status of a GPP in Function DAPD (Display Accounting Period Details) for the GPR or the relevant AP of a participating company in the GPA.

For the purpose of GPAs, a group is defined as a company and all its 51% subsidiaries, and their 51% subsidiaries, and so on. This is a much broader definition than applies, for example, to surrenders under S102 FA 1989 or for group relief purposes. The 51% group relationship must exist at the time the contract is signed and throughout the GPP. If we find that this condition has not been met in respect of one or more of the participating companies, those companies are removed from the arrangement.

Branches of non-resident companies and subsidiaries of non-resident parent companies can be included in the arrangement.

The issue of automatic tax-related penalties is inhibited where the Group Payment Arrangement Indicator is set to P so the participating company appears on Work List PENR (Penalties Requiring Review List) if a tax-related penalty is chargeable. Special rules apply to the calculation of any tax-related penalty on a participating company. For more information see the Company Taxation Manual (CTM) at CTM97570.

The Group Payment Team in Banking Operations (Cumbernauld) is responsible for making the GPA contract and running the GPA. You should refer any queries about setting up a GPA to them.

For more information about GPAs see the Company Taxation Manual (CTM) at CTM97405 onwards.