EIM12825 - Termination payments and benefits: handling enquiries: application of Code of Practice 10 (COP10)
COP10 is a statement of HMRC's policy for dealing with enquiries
and can be found on the Intranet at 'Sites\IR Internet\Featured
Areas\Leaflets & Booklets\Codes of Practice'. COP10 requires
every assistance to be given in finding answers to customers’
enquiries. That assistance can vary from handing out a leaflet to a
detailed discussion.
In the context of providing comprehensive assistance for
customer enquiries, COP10 sets out various circumstances where
answers we give are formally binding on us, and these are detailed
below. Where the enquiry involves a proposed transaction, the
answer can usually only be in the form of guidance and that should
be made clear, whether the response is in writing or otherwise. But
you should be aware that even where guidance is given we would not
seek to retrospectively impose any different result provided that
an enquirer has acted in good faith and supplied all necessary
information. However, if the guidance we give proves technically
wrong we would have to put the correct view in operation for any
subsequent transaction.
However, for some questions, a formal binding answer should
be given (unless the case involves tax planning or avoidance
arrangements). This must involve looking at all relevant
information about the transaction before giving an answer. Appendix
1 in COP10 explains what the customer needs to provide you with in
this respect. The questions are those involving:
- the interpretation of legislation passed in the last 4 Finance Acts (until August 2002 this included FA 1998 which introduced changes to the taxation of termination payments and benefits, see SE13040)
- the application of double taxation agreements
- Statements of Practice (SPs) and Extra-Statutory Concessions (ESCs). For termination payments and benefits this means:
- SP2/81: contributions made to a pension scheme as part of termination arrangements (see SE13735). Note: this SP was enacted as Section 408 ITEPA 2003 with effect from 6 April 2003 (see EIM13735).
- SP10/81: the meaning of disability (see EIM13620)
- SP13/91: voluntary payments on retirement (see EIM15170)
- SP1/94: clearance procedure for redundancy schemes (see EIM13785)
- ESC A10 : lump sums from overseas pension schemes (see EIM15062) and
- ESC A81: legal expenses in termination settlements (see EIM13740).
This does not mean that you must give a binding opinion on a termination case simply because it includes something affected by one of the above, but it does mean that you must give a binding answer about how the SP or ESC operates in the context of the case. See also EIM12827 (other situations where formal binding advice is given).
