CCM8510 - Closing the Examination

Instalment Offers

If the conditions at CCM8440 apply and you have no alternative but to invite an instalment offer, you will need to use one of the draft letters of offer at CCM8740 to CCM8810 Appendix 1 - 8. You need to prepare this on plain paper without any official heading, footnote or logo. Where you are recovering overpaid credits the offer must include a statement of tax credits overpaid. You need to show WTC and CTC separately in the statement. However, it is usually best to insert the amount where instalments are involved as incorrect wording will invalidate the offer.

You will only be able to calculate forward interest, see CCM8450, once you know the terms of the proposed settlement, so if an instalment offer is discussed at a meeting you will often have to carry out your calculations when you return to the office.

There is no objection to you taking a draft instalment letter of offer to a meeting including the wording for the instalments, but excluding the actual amounts. However, you must take care to ensure you calculate forward interest correctly and make sure the instalments add up to the total offer otherwise it is invalid. If an offer is invalid you will need to invite a fresh letter of offer. At any meeting, make sure you cover the points mentioned at CCM8490 and CCM8500 above.

Alternatively, if you are sending the offer out with a letter, perhaps following a meeting, there is no objection to you typing in the amounts to save confusion, as long as it is clear from your papers that there has already been a discussion as to the amount of the offer and the claimant has not been bullied or coerced into agreeing to that particular amount. If the claimant is represented by an agent who is familiar with letters of offer, then you might want to leave the amounts blank. Make sure you cover the points mentioned at CCM8490 above.

The instalment arrangement should include the largest possible down payment (the first instalment). The remaining payments need to be spread over the shortest possible period but you and the claimant must be realistic. You must remember to include forward interest as detailed at CCM8450. When payment is to be made by four or more instalments, you should ask the claimant if payment by direct debit is required. See CCM8530 for further guidance on direct debit arrangements.

The instalments on the letter of offer must be precisely stated and the dates for payment must be precisely ascertainable. It is recommended they are set by reference to the letter of acceptance. The examples at CCM8520 (next page) describe how to set out the terms for the instalments on a letter of offer.