On receipt of a copy licence from MORC, the Tax Accounting
Centre (TAC) is to set up a database record of the licensee and
note the start/end times of the initial accounting period and the
following accounting periods.
TAC should send the licensee 2 sets of Forms
HO72 and HO73 to allow them to make their estimate
of the volume of rebated heavy oil likely to be used in the initial
accounting period and the following accounting period (either
quarterly or annual).
Remind the licensee to complete the initial form and return
this TAC with their remittance
before any rebated oil is used as fuel, and set up
the records required by the regulations.
Should the volume of oil declared on
Form HO72 (and paid for) prove insufficient in any
accounting period, the licensee is required to cease using rebated
heavy oil as fuel until they have completed Form
HO73 and paid the amount of rebate declared on
that form to the Accounting Centre.
TAC should retain a small stock of Forms
HO72 and
HO73 for issue at any time.
If TAC does
not receive Form
HO72 within 10 days of their issue of the form,
they should speak to either
LBS or
Local Compliance.
If staff in either
LBS or
Local Compliance decide to withdraw the licence,
TAC should
not cancel the database entry until MORC advises
them of the cancellation of the licence and the end date of the
final accounting period. A declaration must be made by the licensee
on Form
HO75 for all accounting periods for which the
licence is valid.
Account for Form HO72 (and any Form
HO73 for that accounting period) and the
remittance in accordance with
A5-1 ‘CECAS transaction processing’.
TAC are to retain the original forms for audit purposes. They will
send a copy to the RFCO whose area covers the site at which the
rebated oil is stored.
After placing the remittance accompanying Form HO72 (and any
Form HO73 subsequently furnished in an accounting period) on
miscellaneous cash deposit (MCD), no further action need be taken
by the TAC until shortly before the end of the accounting period
shown in the licence. Then TAC is to despatch Form
HO75 to the licensee at the address at which the
rebated oil is stored. That Form HO75 has to be completed and
returned to the TAC within 10 days of the end of the period. Form
HO72 (and remittance), for the next period, may accompany it if the
licensee anticipates continued need to use rebated heavy oil as
fuel.
You can expect that on Budget Day either the rate of duty on oil
or the rate of rebate allowed on heavy oil will be varied. The
changes make the sums paid against Forms HO72 and HO73 insufficient
(called ‘Event B’ in the Regulations) the trader must
make a further payment to ensure that rebated heavy oil used after
the charge takes effect (usually 6 pm on Budget day) has been paid
for at current rates.
On the eve of Budget Day the TAC will examine the MCD record
and despatch Form
HO74 to each licensee who has presented Form HO72
or Form HO73 in their accounting period. Form HO74 allows the
licensee to declare the volume of heavy oil actually used before
the Budget change, and to declare the expected volume to be used in
the remainder of the accounting period at post-Budget rate(s). The
trader must return the completed form (and remittance) to the TAC
within 3 days of the Budget.
On receipt of Form HO74 (and remittance) TAC should follow
the procedure above. We have no objection to all the outstanding
sums paid by each licensee in the accounting period being
consolidated, and the total sum being re-deposited to one MCD per
licensee.
For new licensees there will be an initial accounting period of
less than 3 months, to end on the 31 March, 30 June, 30 September,
31 December, followed by a standard accounting period (either
quarterly or annual). The copy Licence for each licensee will show
the period length.
Shortly before the end of an accounting period TAC is to
despatch Form HO75 to those licensees who have made a payment.
(That form provides for the licensee to declare he actual volume of
heavy oil used in the period as fuel, and to claim refund of the
sum overpaid.) At the same time Form HO72 is to be sent (unless a
licence has been withdrawn) so that the licensee can estimate his
likely usage in the next period, and make any payment due. When
received at TAC, the completed Form HO72 is to be dealt with in
accordance with the accounting instructions above.
TAC will use the completed Form HO75 (which will not be
accompanied by any remittance) to adjust the MCD raised in the name
of that licensee, bring to account the rebate due for the
accounting period and refund the balance overpaid. The Form HO75
provides for the rebate amount payable for the period to be
analysed against tax type codes.
Any sum overpaid in an earlier accounting period can be
re-deposited to the credit of that licensee for he next period
provided that the licensee has submitted Form HO72 for that next
period ( and the amount payable shown on that Form HO72 equated to
the sum refundable shown on the Form HO75 for the earlier period).
Otherwise it is intended that each accounting period will end with
the HO75 leading to a small refund to the licensee.
