INTM215390 - Controlled Foreign Companies: before CTSA

Assessment: appeal against notice of assessment

ICTA88/S754 (3) and (4)

A company which is assessed under Chapter IV may appeal. It must do this in writing. It has thirty days after the date of the notice of assessment. It should strictly give the notice of appeal to the Inspector who gave notice of the assessment. The Inspector should not object, however, if the company makes the appeal to the Board. If an appeal is received for a case which is being worked at CT & VAT, International CT, the appeal should be passed on immediately and advice will be given on how to deal with any postponement application.

The grounds of appeal against a Chapter IV assessment are limited. A company cannot use a ground which it has, or could, use in another appeal.

This could be against a Board's notice of:

• the making of a direction,
• the amendment to a direction giving a revised accounting period - see INTM215130, or
• a declaration under ICTA88/SCH24/PARA11 (3) or ICTA88/SCH25/PARA3 (2) - see INTM215190.

The appeal could also be against an Inspector's notice giving a revised amount of chargeable profits or creditable tax under ICTA88/S753 (6) - see INTM215140.

These limitations are to avoid more than one right of appeal. This can happen with rights against notices of assessment and notices of direction, etc.

Appeals against Chapter IV assessments are to the Special Commissioners. The Special Commissioners can review any relevant decision of the Board under ICTA88/S752. These are decisions about apportioning chargeable profits and creditable tax - see INTM215340.

The Board can treat a loan creditor as having an interest in a controlled foreign company. It can apportion chargeable profits to that creditor. The creditor can appeal against any resulting assessment. The Special Commissioners can then determine whether the Board acted reasonably.

A notice of appeal must give the grounds of appeal. The Special Commissioners can, however, allow the appellant to put forward any ground not given in the notice. That is if they think that the omission was not wilful or unreasonable. The Inspector should not normally object if a company gives a ground of appeal not specified in a notice.

On receipt of an appeal against a notice of assessment, the clerical instructions referred to at the fourth bullet of INTM215120 require

• the stand over of any tax charged in the assessment
• the submission of the file to an Inspector

If the appeal is for a case which is being worked by an Inspector, the postponement application should be dealt with in accordance with INTM215410.