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HMRC internal manual

Enquiry Manual

Contract settlements: acceptance: SAFE - accounting: what you must do before you issue a letter of 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 the letter of offer has been checked and acceptance of the offer has been authorised, you must make sure that all the relevant charges and payments have been correctly accounted for before you can issue the letter of acceptance.

If you work in Local Compliance you must also follow the additional procedures for caseworkers in Local Compliance, details of which are located further down this page. This specific guidance for Local Compliance is in addition to the general guidance below, which you must follow before you issue the letter of acceptance, irrespective of whether you are in Local Compliance or not.

  • EM6401 - Contract Settlements: Acceptance: Check of Letter of Offer
  • EM6403 - Contract Settlements: Acceptance: SAFE - General
  • EM6407 - Contract Settlements: Acceptance: SAFE - Handling General Payments on Account
  • EM6408 - Acceptance: SAFE - Amending a Charge

You must also follow any guidance relating to the specific circumstances, see EM6400, for example when the offer is an instalment offer.

Additional procedures for caseworkers in what was previously Local Compliance

Additional safeguards have been introduced in what was previously Local Compliance. These are an important part of the settlement process and either your manager, or another caseworker who has been delegated this task by your manager, must certify that your accounting is correct.

1. Caseworker compiles settlement papers

You must either prepare a paper settlement folder containing the documents listed below or, where the documents are stored electronically, clearly identify the location where they are stored and the name and reference number of each document. Where there is a paper folder, the documents should be the originals unless you do not have access to them because they have been centrally scanned and stored electronically. In that case, make a note on the folder saying where the originals are stored and list the name or reference number of each document.

Documents to be listed or placed in a settlement folder:

  • The letter of offer that we are accepting.
  • Form 94 or the final version of the contract settlement form (CSF), see CH411130+.
  • Any certificate of full disclosure or statement of assets.
  • The appropriate SAFE contract stencil used to raise the SAFE charge.
  • The completed and signed letter of the acceptance that you intend to issue. The letter must be signed.

Once you have compiled the list of documents, or paper folder, you must pass them to your manager or the certifying officer to check.

  1. Action for the certifying officer

If you are the certifying officer or manager you must complete the final accounting procedures checklist (Word 15kb) electronically.

Save the completed checklist to Case Document Store in Caseflow, see ‘How to capture a document in Caseflow’.

The checklist must be named ‘CSF final accounting procedures completed.

The Documentation Classification should be ‘Offer and Certificate’.

The document must be finalised, see How to finalise a document in Caseflow. This will make sure a complete audit trail is available should the case be presented to a court or tribunal.