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HMRC internal manual

Debt Management and Banking Manual

HM Revenue & Customs
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Time To Pay: Time To Pay requests: offsetting losses


In certain circumstances we can take into account the fact that a customer is making a loss in the current year when deciding whether to grant Time To Pay (TTP) for Income Tax or Corporation Tax due on profits from last year.


The conditions that must be met before we can consider if we can take into account current year losses are that the customer:

  • must be genuinely unable to pay immediately or enter into a reasonable TTP arrangement
  • the tax owed is Corporation Tax or Income Tax on previous years’ profits
  • the customer is likely to make a loss in the current year.

Where these conditions are met, the case will be passed to a Compliance team who will review the case and will contact the customer to discuss their current trading situation.

Referring the case to Compliance

When a customer has contacted DMB and the customer meets the conditions for taking current year losses into account, you should:

  • update IDMS, complete the Offsetting Losses stencil (Word 135KB), and email this to Foster, Jean (DMB Debt Management)(This content has been withheld because of exemptions in the Freedom of Information Act 2000) Nichols, Elaine (LocalCOMP Large & Complex) with the subject of the email as “Offsetting losses request”; in BPSS, emails will automatically be produced when ‘Offset Losses’ is chosen as the Selecta outcome
  • set a BF on the case for (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .

Compliance actions

When the Compliance team receive the email, they will:

  • review the case
  • check that the customer meets the conditions above
  • contact the customer to discuss the current trading situation
  • ask for documentary evidence to support the loss (where appropriate).

Where Compliance deem that the claim is reasonable they will arrange for the appropriate amount to be stoodover and a note entered on SA or COTAX.

Where a collectable balance remains or the customer does not meet the conditions to offset their anticipated loss then an email headed “Offset Losses” will be sent to either:

  • DM CT, VAT & EEC CATT (DMB Debt Mgmt) for CT
  • Worcester DMB Enquiries, 1 (DMB) for SA.

Referrals from Compliance

Occasionally, Compliance may receive requests for set-off of loss claims directly from customers. Compliance will contact the customer and advise them to contact the BPSS on 0300 200 3835 to discuss payment options prior to consideration of the claim.