Corporation Tax

Notification of uncertain tax treatment ― overview

Produced by Tolley
  • 05 May 2022 06:51

The following Corporation Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Notification of uncertain tax treatment ― overview
  • Introduction
  • The requirement to notify
  • What businesses are subject to the requirement to notify?
  • What is a ‘large company’ for these purposes?
  • Group companies
  • Which taxes are subject to the uncertain tax treatment notification?
  • What is an uncertain tax position?
  • First trigger ― provision in the accounts
  • Second trigger ― HMRC’s known position
  • More...

Notification of uncertain tax treatment ― overview


For returns due on or after 1 April 2022, certain large companies and partnerships are required to notify HMRC where they adopt an uncertain tax treatment for corporation tax, VAT or income tax (both self assessment and amounts collected via PAYE).

The stated aim of the notification regime is to ensure that HMRC is aware of all cases where a large business has adopted a treatment that is contrary to HMRC’s known position and to bring forward the point at which discussions occur in relation to the tax treatment, thereby reducing what the Government refers to as the ‘legal interpretation tax gap’.

The notification requirement is one part of a series of measures aimed at improving the transparency in the approach large businesses take towards taxation, such as the sanctions for uncooperative behaviours and the requirement to publish tax strategies. For commentary on these, see the Sanctions for persistently uncooperative large businesses and Publication of tax strategies by large businesses guidance notes.

The regime applies to large (as defined) companies, partnerships and LLPs including both UK resident entities and non-UK resident entities that have a UK presence (for example, an overseas company with a UK permanent establishment).

Broadly, a large business is one with turnover above £200m and / or a gross balance sheet total above £2 billion in the previous financial year. For non-resident companies, the turnover and balance sheet amounts relate only to the UK presence of the business and there are specific

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