Multinational Top-up Tax and Domestic Top-up Tax

MTT55310 - Administration: Compliance: Discovery assessments and HMRC determinations: Overview

This guidance focuses on the legal background of discovery assessments in the Multinational Top-up Tax (MTT) context. There is existing procedural guidance in the Enquiry Manual at EM3200 which should also be consulted.

As established in Part 5, Schedule 14 to Finance (No.2) Act 2023 the assessment contained in a self-assessment return creates a legal charge to tax. Subject to the right of HMRC to make a discovery assessment, the return is final once made. This is unless, within the relevant time limits, the filing member amends the return or an HMRC officer decides to open a compliance check into it.

The ability to make discovery assessments ensures that additional tax liable as a result of mistaken or incorrect MTT returns is assessed. There are taxpayer safeguards and restrictions governing the use of discovery assessments, including time limits on when an assessment can be made that are dependent on customer behaviour.

It is important to note a discovery assessment can only be made where there has been careless or deliberate behaviour or where information was not made available to HMRC.

The following pages set out the use of these powers in more detail, including the time limits by which a discovery assessment is to be issued, its scope and what a notice of assessment must include.

This is set out in part 8, schedule 14 to Finance (No.2) Act 2023.