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HMRC internal manual

Self Assessment Claims Manual

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HM Revenue & Customs
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Consequential Claims after Assessment and Amendment: Culpable Additions

Where we make a discovery assessment or amend a return in an SA enquiry closure notice because of fraudulent or negligent conduct, the taxpayer can make an out-of-time claim for a relief or allowance for the relevant year.

The claim is limited to the extent that it can be given effect to

  • in the discovery assessment, or
  • against the additional liability charged by our amendment. (TMA70/S36(3) and 43C(1))

In such cases we accept that making a claim also includes increasing the amount of a previous claim.

Not all claims fall within the wording of section 36(3). For example it does not apply to

  • a claim that an asset has become of negligible value (TCGA92/S24 (2))
  • a claim that a loan to a trader has become irrecoverable (TCGA92/S253)

Section 36(3) does not permit a taxpayer to make an election out-of-time.

A report should be made to the appropriate Head Office section where, in the case of a late election, the Board is empowered to allow further time or a submission is mandatory. For example, certain late capital gains tax elections must be submitted under the guidance at CG13810.