What is a tax determination?
Produced in partnership with Philip Rutherford
What is a tax determination?

The following Tax guidance note Produced in partnership with Philip Rutherford provides comprehensive and up to date legal information covering:

  • What is a tax determination?
  • Summary of what a determination is
  • When is a determination used?
  • Quantum of the determination
  • Time limits for HMRC to make a determination
  • Effect of a determination
  • How can a determination be displaced?
  • Special relief
  • HMRC can still enquire into tax return that displaces a determination
  • Discovery
  • more

This Practice Note explains:

  1. what a determination in respect of direct tax (ie a direct tax determination) is

  2. when HMRC might issue a direct tax determination

  3. the quantum of a possible direct tax determination

  4. the time limits within which HMRC can make such a determination

  5. the effect of such a determination on a taxpayer, and

  6. the options available to a taxpayer to displace a direct tax determination

For the purposes of this Practice Note, except where expressly provided otherwise, a determination is used to refer to a direct tax determination.

For a practical guide on how to deal with a direct tax determination, see: Practical steps for dealing with a tax determination—checklist.

Summary of what a determination is

A determination:

  1. is issued by HMRC where a taxpayer fails to file a tax return in response to a notice requiring the taxpayer to file a return

  2. is based on an HMRC estimate of the amount of tax due

  3. is treated as though it were a tax return filed by the taxpayer, ie HMRC's estimate is the amount the taxpayer is liable to pay to HMRC, and

  4. gives HMRC the opportunity to commence formal proceedings to recover the unpaid tax

There is no right of appeal against a determination in respect of direct taxes. Such a determination can only be superseded:

  1. by an actual self-assessment