SDLTM81920 - Compliance: Working an enquiry

Jeopardy amendments: When to make a jeopardy amendment

The legislation at FA03/SCH10/PARA17 is silent about the circumstances in which a jeopardy amendment might be appropriate.

In particular, a compliance caseworker should consider making an amendment where it is discovered or suspected that

• the purchaser intends to dispose of assets
• the purchaser intends to become non-resident
• the purchaser intends to apply for bankruptcy or the company intends to go into liquidation
• an individual may be about to go to prison

The compliance caseworker is obliged by statute to be of the opinion that if they do not act there will be some loss of tax.

The phrase loss of tax does not just mean circumstances where tax might not be paid at all. It can include situations where the payment of tax has been delayed for an unreasonable time owing to the default of the purchaser.

A jeopardy amendment should also be considered where the purchaser refuses to co- operate but only if it has already been established with some degree of certainty that the land transaction return is deficient. This is not to try to force a purchaser to co-operate but to protect HM Revenue & Customs because it is believed that there is a risk of tax being lost.