AH0195 - Postponement applications: Informal standovers

A charge can be informally stoodover where there are no legal grounds for standing over any of it but it is considered that there is justification for temporarily suspending collection of all or part of that amount. An informal standover should, however, not be used if it is possible to formally standover all or part of the charge.

Particular circumstances in which a charge may be informally stoodover are:-

• an appeal is received and the postponement provisions (TMA70/S55) do not apply
• if the charge arising from a HMRC assessment is formally stoodover following an appeal it may be appropriate to informally standover the following year’s payments on account pending the determination of the appeal. (Note: there is no legal right to apply for the payments on account to be formally stoodover, although the taxpayer can make a separate application for them to be reduced).

See AH0151 for a list of circumstances in which the postponement provisions do not apply.

Referral to senior officer

If an appeal against an assessment under ICTA88/SCH16 to recover income tax on company payments, where the time for payment of the tax charged is given by ICTA88/SCH16/PARA4(1) or ICTA88/SCH16/PARA9, stand the tax over and refer the appeal to a senior officer.

Do the same if an appeal is received against a Regulation 14(1) assessment.

Interest on unpaid tax

An informal standover does not affect either the reckonable date for interest. It is therefore important that taxpayers are advised of the possible consequences of not making a realistic payment on account when an assessment is under appeal or a charge is otherwise under enquiry.

SA surcharge

An informal standover also does not affect the due date from which SA surcharge is calculated. But surcharge will not be calculated whilst an informal standover is recorded against the charge.

Overpayment of Tax Credit

If an overpayment of tax credit is the subject of recovery action and an appeal is received suspend recovery action in full or in part.