Contract Settlements: Letters of Offer: Delay in Acceptance
The guidance about contract settlements at EM6000+ only relates to direct tax. You must never include VAT or VAT penalties in a contract settlement.
Once made, an offer which is neither withdrawn nor rejected remains open for acceptance for a reasonable time. We consider six months is a reasonable time.
Where an offer is not accepted within six months of the date of the letter of offer through
- delay or
- the need for clarification
- ask the taxpayer to confirm in writing that they wish the offer, un-amended in any respect (except as specified), to go forward for consideration.
- ensure that it is submitted in good time for the acceptance letter to be issued within the 6 month period.
If the submission is made within a month of the crucial day you should
- mark the case prominently for urgent attention or give advance warning.
An offer can only be formally rejected by the Board. So an attempt
- to negotiate further, or
- to re-open negotiations (whether on Head Office instructions or otherwise)
could in law amount to the rejection of the offer.
If you are unable to secure a better offer and propose to accept (or recommend acceptance of) the original offer you should
- request a letter on the lines suggested in the first bullet point above, unless advised to the contrary by ‘contact link’.