Commentary

V7.362 Partial exemption special methods—changes in circumstances

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.362 Partial exemption special methods—changes in circumstances

Part V7 Tax planning | Commentary

V7.362 Partial exemption special methods—changes in circumstances

A special method approval letter from HMRC will include a paragraph that any significant change in the nature of the business must be notified to them if it has an effect on the amount of input tax being reclaimed. The method will then be reviewed, and if the fair and reasonable argument no longer applies, then a direction will be issued to stop a business from using the special method. It is then up to the taxpayer to propose an alternative special method, or accept the standard method instead.

One important power that HMRC

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