V5.136A Time limit for making a VAT assessment—categories of assessment
For the circumstances under which HMRC may assess VAT, see V5.132.
The time limits within which HMRC may assess for each category of assessment are set out below. These limits are extended to 20 years in certain cases (broadly, those involving dishonesty); see V5.136B.
Assessment made under VATA 1994, s 73(1) (incorrect returns; failure to make returns, keep documents or afford verification facilities), (2) (repayment or credit not due) or (3) (cancellation of registration)
An assessment may not be made after the later of1:
• two years after the end of the prescribed accounting period concerned2, or
• one year after evidence of facts sufficient in the opinion of HMRC to justify the making of the assessment comes to their knowledge3
X overstates input tax for the prescribed accounting period ended 30 September 2014. The error is discovered by HMRC during a visit taking place on 31 January 2015 and the tax due is quantified on the same day.
An assessment must be made on or before 30 September 2016, ie the later of:
(a) two years after the end of the prescribed accounting period, ie 30 September 2016, and
(b) one year after evidence came to the knowledge of HMRC, ie 31 January 2016
The question of 'the prescribed accounting period concerned' has been considered in a number of cases in relation to VATA 1994, s 73(2), ie where HMRC has repaid an amount which should not have
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