CH23520 - Information & Inspection Powers: Information Notices: Taxpayer Notice: Specific rules
You can give a written notice to a person requiring them to provide information or produce documents reasonably required to check their tax position. This is a ‘taxpayer notice’.
In addition to the general restrictions, see CH22100, and general rules, see CH23220, that apply to information notices there are specific rules for taxpayer notices. Operational guidance about taxpayer notices starts at CH223000.
Approval
Appeals
Self Assessment return
Partnerships
Stamp duty land tax
Bank payroll tax return
Approval
You do not need specific approval before giving a taxpayer notice, although you must have the agreement of an authorised officer if you need to ask for an old document, see CH22140, and you must contact Central Policy, Tax Administration Advice (TAA) before asking for any advice the person got from their tax adviser, see CH22300.
You can choose to get the approval of the tribunal before giving a notice provided the appropriate conditions are met, see CH24120. This includes getting the agreement of an authorised officer and, if asking for tax advice material, contacting Central Policy, Tax Administration Advice (TAA) first. You would be most likely to want to seek tribunal approval where you need to protect your information from premature exposure at an appeal hearing against the notice, or where there are grounds to invoke the possibility of criminal sanctions for destroying documents, see CH27200.
Appeals
The person can appeal against
- the notice or
- any requirement in the notice, see CH24320.
However, there is no right of appeal against
- a requirement to provide information or produce any document that is part of the person’s statutory records, see CH21700
- a notice or any requirement that requires only statutory records of any person relating to
-
- the supply of goods or services, or
- the acquisition or importation of goods from an EU member state, or
- the importation of goods from outside the member states in the course of carrying on a business, or
- a notice or any requirement approved by the tribunal. This is because the independent approval safeguards the person’s rights.
Self Assessment return
If a person has made a Self Assessment return, claim or election for a chargeable period, CH23540, you can only issue a taxpayer notice to check a person’s income tax, capital gains tax or corporation tax position for that period if one or more of the following conditions apply.
- There is an open enquiry, see CH23540, into the SA or CTSA return, the claim or the election, or
- you have reason to suspect, see CH23560, that
- The information or documents are also required to check their position regarding any tax other than income tax, capital gains tax or corporation tax or their tax position as an employer, contractor or person with other similar obligations to make deductions or repayments of tax or withholding of income.
But even where the above conditions do not apply, you can still issue a notice if you are giving a notice to a person
- who may be, or may become, liable to tax under CTA10/S710 or CTA10/S713 (Change in company ownership), or
- who carries on a trade for which a Herd Basis Election has been made if the notice refers only to information and documents that relate to
-
- the animals kept for the purposes of the trade, or
- the products of those animals, or
- to whom a tax avoidance counteraction provision under CTA10/S733 or ITA07/S684 applies by reason of one or more transactions if the notice refers only to information or documents relating to that/ those transactions.
You only need to open an enquiry into an SA or CTSA return if you are checking the person’s tax position relating to the capacity in which the person made the return.
For example, if the person has made an SA return for a period as a trustee but has not made a personal SA return for that period, you do not give notice of enquiry into the trust’s SA return if you are only checking the person’s own income tax position.
Partnerships
Where a Self Assessment return is a partnership return, or where a partnership has made a claim or election, the conditions above apply as if the return, claim or election had been made by each of the relevant partners, see CH21600, for that chargeable period. CH21600 also gives information about a partner’s rights to access partnership books and records.
The partners are only regarded as having made an SA return in their capacity as partners. So if a person is regarded as having made a partnership return for a period but has not yet made their personal SA return you do not need to give notice of enquiry into the partnership return if you are checking the person’s income tax position in respect of anything other than their share of partnership profit.
Similarly, where a stamp duty land tax return or claim is made by or on behalf of the members of a partnership, each partner is regarded as having made the return or claim.
Stamp duty land tax
Various rules and conditions have to be met before you can give a written taxpayer notice to a person requiring them to provide information or produce documents reasonably required to check their stamp duty land tax position.
The general restrictions, see CH22100, general rules, see CH23220, and rules about approval and appeals in CH23520, apply. There are also specific rules for taxpayer notices following stamp duty land tax returns.
If a person has made a stamp duty land tax return, claim or amendment of a claim for a chargeable period, you can only give a taxpayer notice to check the person’s stamp duty land tax for that period if one or more of the following conditions apply
- there is an open enquiry into the return, claim or amendment to a claim, or
- you have reason to suspect, see CH23560, that
-
- an amount that ought to have been assessed to stamp duty land tax in respect of the transaction may not have been assessed, or
- an assessment to stamp duty land tax in respect of the transaction may be or have become insufficient, or
- relief from stamp duty land tax given in respect of the transaction may be or have become excessive, or
- the notice is given for the purpose of obtaining any information or document that is also required for the purpose of checking that person’s position regarding a tax other than stamp duty land tax. But there is an important exception, see the next paragraph.
Where a person has made an SDLT return and an SA return for the same period, in theory the rule above means that you do not have to open an enquiry into either return but in practice you must open an enquiry into both. For example, if the other tax is capital gains tax and the person has made an SA return for the period we must have an open enquiry into both the stamp duty land tax return and SA return.
Bank payroll tax return
Where a taxable company has filed a bank payroll tax return, or made a claim, you can only issue a taxpayer notice to check the bank payroll tax position if one or more of the following conditions apply.
- There is an open enquiry, CH23540, into the bank payroll tax return or claim.
- You have reason to suspect, see CH23560, that
- The information or documents are also required to check their tax position as an employer, contractor or person with other similar obligations to make deductions or repayments of tax or withholding of income.
Appendix 1 contains examples of
- an unapproved taxpayer notice - CHApp1.1 (Word 44KB)
- an opportunity letter before seeking tribunal approval - CHApp1.2 (Word 34KB)
- a tribunal-approved taxpayer notice - CHApp1.3 (Word 39KB).
