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HMRC internal manual

Excise Assessments Interim Guidance

Assessments to excise duty: powers to assess

Our main power to assess excise duty is contained in Finance Act 1994, Section 12 and officers’ assessments are usually made under subsections 1 and 1A of Section 12.

Excise assessments are provided for in the Finance act as a means of establishing a legally enforceable debt which can then be pursued as a debt due to the Crown.

Other legal powers of assessment can be found at EAIG2100.

Finance Act 1994 section 12 contains two powers to assess excise duty.

The first of those powers is provided for by section 12(1). This is the main excise assessment provision and is used when there is a failure to make a return or duty is under-declared or has otherwise become due. This is called the “default” power since the power to assess is dependant upon there having been a breach of the conditions described in sections 12(2) and (2A), see EAIG2200.

The second assessing power is provided for at section 12(1A), and is known as the “ascertained” power, see EAIG2400. Generally this power is used where duty has become due but there has been no default as described in sections 12(2) or (2A).

The two powers are not mutually exclusive. Both may apply when an amount of excise duty has become due from a person and there has been a default. However, it is best practice where a default is identified that the section 12(1) power be used.

The section 12(1A) power must be used in circumstances where there has not been a default.