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HMRC internal manual

Inheritance Tax Manual

Letters of offer: taxpayer’s default

The standard letters of offer (IHTM36351) all include an acknowledgement of default, usually on the part of those signing the offer. If someone not guilty of an offence under the Taxes Acts is making the offer the wording should reflect this. If, for example, the offer is to be signed by the taxpayer’s agent (IHTM36342), it will have to refer to the default of the client.

Where tax is included in the offer, a taxpayer may be prepared to make the expected offer, but may refuse to sign an admission of default. In such a case the wording can be changed to ‘ …set out in the Statement below which are alleged by HMRC to be unpaid by reason wholly or partly of my default…’. If the offer is for penalties only, the wording can be changed to ‘ …which HMRC allege has been incurred…’.

If the taxpayer is not prepared to accept this wording, you will have to submit the case to Tax Administration, Litigation and Advice (TALA) (IHTM36361), through your SO manager and the Penalty Portfolio Holder, to consider formal proceedings.