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HMRC internal manual

Inheritance Tax Manual

Liabilities: investigating liabilities: voluntary payments of tax

There are occasions when the personal representatives will pay income tax that cannot be assessed. This sort of situation may arise where assessments were not raised within the relevant time limit.

In these circumstances you should treat the liability as a valid deduction even though, in strictness, the payment is voluntary. The result of this is that a deduction may be claimed in respect of the liability that cannot be assessed - and following the ruling in Re Sutherland deceased [1963] AC 235 it will have to be allowed. This is because the liability is created and imposed by the section of legislation that relates to charging tax and does not depend on an assessment being issued.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)