SDLTM82960 - Compliance: Concluding an enquiry

Contract settlements: Acceptance letter

When the letter of offer is returned the compliance caseworker should check that

• any alterations made are acceptable by reference to the criteria shown in the checklist in SDLTM82820 and have been initialled by the signatory
• there are no blank spaces (for example, an offer to pay within .…….... days cannot be accepted)
• the offer has been signed by the person (or all the persons) for whom it was intended
• there was no covering letter or other suggestion which could be thought to modify the terms of the offer in any way (for example, a request for more time to pay)
• the offer if made by a partnership (including husbands and wives) has been signed by each partner
• the offer was signed within the previous six months

If the offer is satisfactory in every respect, and can be accepted locally, a letter of acceptance should be issued in the following terms

‘On behalf of the Commissioners of HM Revenue & Customs I accept your (client’s) offer dated
……./……./……. to pay the sum of £…….... on the basis set out in the offer.
The amount of £…….... should be paid in accordance with the enclosed notice.’

Notes

The acceptance letter must be kept short and be limited to the essentials. If, for example, the compliance caseworker decided to set out any of the terms of the offer, and did so incorrectly, the acceptance could be invalidated.

The acceptance letter should be signed by the compliance caseworker.

The gross amount of the offer should be entered in the first sentence, and the net amount to be paid after all deductions in the second.

The heading of the letter should include the name of each person who has signed the offer, especially in cases where the signatories have been joined in a company offer.

The final sentence should be omitted if the settlement is covered by payments on account or set- off and no further payment is required. If a locally acceptable offer is accompanied by a remittance for the balance due the remittance should be acknowledged.

If a specific date is given for payment of the balance due (or for the first instalment of an instalment offer) the letter of acceptance must be issued in time to reach the purchaser before the payment is due. The contract would otherwise be impossible to fulfil.

When accepting an instalment offer the first paragraph of the letter should read

‘…on the basis and in the manner set out in the offer.’

The final sentence should begin

‘The first instalment of £…….... should be paid by/on ……....’

If the letter of offer has been amended by a letter from the agent the compliance caseworker should refer to SDLTM82820 to determine whether the letter is acceptable.

If there is no agent the acceptance letter should be addressed to all the persons making the offer, with a copy for each signatory.

The acceptance must be as unequivocal as the offer. The terms of the offer cannot in any way be modified by the letter of acceptance. Any attempt to do so could make the acceptance ineffective. If there is anything more to be said, not directly connected with the acceptance of the offer, a separate letter should be sent.

Where the settlement is not one to be accepted locally a letter of acceptance and application for payment will be issued centrally. A copy of that letter of acceptance will then be sent to the compliance caseworker with any advice necessary to bring the case to conclusion, for example, advice regarding any amounts to be set against the settlement.