Commentary

D9.134 Formal notice of counteraction

Corporate tax
Corporate tax | Commentary

D9.134 Formal notice of counteraction

Corporate tax | Commentary

D9.134 Formal notice of counteraction

The procedure for the counteraction of a tax advantage differs slightly for corporation tax and income tax purposes for transactions occurring on or after 6 April 2016. Prior to 6 April 2016, the two procedures were effectively the same. The reason for the change is to align the income tax procedure more closely with the process for compliance checks under self-assessment.

Current corporation tax regime and income tax regime prior to 6 April 2016

Where a preliminary notification (D9.132) has been issued to a taxpayer and either he has not made a statutory declaration or the Tribunal has found a prima facie case for proceeding, the HMRC officer will issue a formal notice of counteraction specifying the adjustments which are to be made to counteract the tax advantage1. The adjustments may consist of an assessment, the nullifying of a right to repayment, the requiring of the return of a repayment already made or the computation or re-computation of profits or gains or liability to income tax or corporation tax. The HMRC officer will arrange for any necessary assessments or amendments to assessments to be made. No assessment may be made more than six years after the chargeable period (in the case of income tax, the year of assessment and in the case of corporation tax, the accounting period) to which the tax advantage relates2.

Income tax regime from 6 April 2016

Where a notice of enquiry (D9.132) has been issued to a taxpayer, the HMRC officer will

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