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HMRC internal manual

Securities Guidance

From
HM Revenue & Customs
Updated
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Security as a condition of releasing a VAT credit: introduction

VAT law gives us the power to require security as a condition of releasing a VAT credit.

We may give a person a Notice of Requirement if they make a large or unusual claim that we need time to verify.

We may also require security where we have, or are about to, notify a person that they are or may be jointly and severally liable for VAT unpaid on the supply of specified goods.

We only require an amount of security equivalent to the payment we make, or are considering making, to the person.

We will accept security by means of a deposit into a joint account, or by a performance bond, see SG29500.

If the person doesn’t provide security we will withhold a VAT claim until it is verified, or until notices of joint and several liability for unpaid VAT are paid or withdrawn.

We may offset any VAT claim covered by a Notice of Requirement against any joint and several liability notices. We will hold the security until the VAT claim is verified, or when any notices of joint and several liability are paid or withdrawn.

If we disallow all or part of the claim we may use the security to cover any part of the tax that has already been repaid, or against any unpaid joint and several liability notices.