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Finance Act 1989

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This is the original version (as it was originally enacted).

150Further assessments: claims etc

(1)The following sections shall be inserted after section 43 of the Taxes Management Act 1970—

43AFurther assessments: claims etc

(1)This section applies where—

(a)by virtue of section 29(3) of this Act an assessment is made on any person for a chargeable period, and

(b)the assessment is not made for the purpose of making good to the Crown any loss of tax attributable to his fraudulent or negligent conduct or the fraudulent or negligent conduct of a person acting on his behalf.

(2)Without prejudice to section 43(2) above but subject to section 43B below, where this section applies—

(a)any relevant claim, election, application or notice which could have been made or given within the time allowed by the Taxes Acts may be made or given at any time within one year from the end of the chargeable period in which the assessment is made, and

(b)any relevant claim, election, application or notice previously made or given may at any such time be revoked or varied—

(i)in the same manner as it was made or given, and

(ii)by or with the consent of the same person or persons who made, gave or consented to it (or, in the case of any such person who has died, by or with the consent of his personal representatives),

except where by virtue of any enactment it is irrevocable.

(3) For the purposes of this section and section 43B below, a claim, election, application or notice is relevant in relation to an assessment for a chargeable period if—

(a)it relates to that chargeable period or is made or given by reference to an event occurring in that chargeable period, and

(b)it or, as the case may be, its revocation or variation has or could have the effect of reducing any of the liabilities mentioned in subsection (4) below.

(4)The liabilities referred to in subsection (3) above are—

(a)the increased liability to tax resulting from the assessment,

(b)any other liability to tax of the person concerned for—

(i)the chargeable period to which the assessment relates, or

(ii)any chargeable period which follows that chargeable period and ends not later than one year after the end of the chargeable period in which the assessment is made.

(5)Where a claim, election, application or notice is made, given, revoked or varied by virtue of subsection (2) above, all such adjustments shall be made, whether by way of discharge or repayment of tax or the making of assessments or otherwise, as are required to take account of the effect of the taking of that action on any person’s liability to tax for any chargeable period.

(6)The provisions of this Act relating to appeals against decisions on claims shall apply with any necessary modifications to a decision on the revocation or variation of a claim by virtue of subsection (2) above.

43BLimits on application of section 43A

(1)If the effect of the exercise by any person of a power conferred by section 43A(2) above—

(a)to make or give a claim, election, application or notice, or

(b)to revoke or vary a claim, election, application or notice previously made or given,

would be to alter the liability to tax of another person, that power may not be exercised except with the consent in writing of that other person or, where he has died, his personal representatives.

(2)Where—

(a)a power conferred by subsection (2) of section 43A above is exercised in consequence of an assessment made on a person, and

(b)the exercise of the power increases the liability to tax of another person,

that section shall not apply by reason of any assessment made because of that increased liability.

(3)In any case where—

(a)one or more relevant claims, elections, applications or notices are made, given, revoked or varied by virtue of the application of section 43A above in the case of an assessment, and

(b)the total of the reductions in liability to tax which, apart from this subsection, would result from the action mentioned in paragraph (a) above would exceed the additional liability to tax resulting from the assessment,

the excess shall not be available to reduce any liability to tax.

(4)Where subsection (3) above has the effect of limiting either the reduction in a person’s liability to tax for more than one period or the reduction in the liability to tax of more than one person, the limited amount shall be apportioned between the periods or persons concerned—

(a)except where paragraph (b) below applies, in such manner as may be specified by the inspector by notice in writing to the person or persons concerned, or

(b)where the person concerned gives (or the persons concerned jointly give) notice in writing to the inspector within the relevant period, in such manner as may be specified in the notice given by the person or persons concerned.

(5)For the purposes of paragraph (b) of subsection (4) above the relevant period is the period of 30 days beginning with the day on which notice under paragraph (a) of that subsection is given to the person concerned or, where more than one person is concerned, the latest date on which such notice is given to any of them.

(2)This section shall apply in relation to any assessment notice of which is issued on or after the day on which this Act is passed.

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