This regulation deals with the notice and certificate procedures
where, 17 days or more after the end of a tax period, either of the
following conditions apply: (A) the contractor has not paid any
amount during the tax period and HMRC believes an amount is due for
that tax period; (B) the contractor has paid an amount of
deductions over during the period but HMRC is not satisfied, after
seeking the contractor’s explanation, that it is the full
amount: SI2005/2045 reg 11(1), (2) and (3).
If either of the conditions are met, HMRC can look at the
contractor’s previous payment record and specify, to their
best judgement, an amount which they consider is due and payable
and may serve a notice on the contractor requiring that amount to
be paid within 7 days of the issue of the notice: SI2005/2045 reg
11(4).
If condition (A) is met in respect of two or more consecutive
tax periods in a tax year, HMRC can give notice under (4) as if the
consecutive periods were the latest tax period specified in the
notice: SI2005/2045 reg 11(5).
If, during the notice period, the contractor claims that they
have paid over the full amount of deductions but HMRC are not
satisfied, the contractor can ask HMRC to inspect the
contractor’s records as if they had been required to produce
them under SI2005/2045 reg 51: SI2005/2045 reg 11(6).
Where HMRC does inspect the records in accordance with
SI2005/2045 reg 11(6) and SI2005/2045 reg 51, any notice issued by
HMRC under SI2005/2045 reg 11(4) is to be disregarded: SI2005/2045
reg 11(7).
Any amounts unpaid at the end of the period of the notice
made at SI2005/2045 reg 11(4) are treated as though they were due
in accordance with SI2005/2045 reg 7 and HMRC can prepare a
certificate showing amounts unpaid: SI2005/2045 reg 11(8).
If, during the notice period, the contractor settles all
outstanding amounts or satisfies HMRC that no monies are due, then
SI2005/2045 reg 11(8) does not apply: SI2005/2045 reg 11(9).
If the contractor settles the amount certified by HMRC and it
transpires that the amount due was a lesser amount, the contractor
is entitled to offset any excess monies against sums due for a
later tax period in the tax year: SI2005/2045 reg 11(10) and (11).
Sub-section (12) refers to SI2005/2045 reg 57 which deals
with the use of certificates as evidence of sums due and payable.
ENABLING PROVISION – FA04/S71 (1)
