This guidance sets out where you can rely on information or advice you receive from HMRC. Our Clearances and Approvals page provides details of where you can get advice from HMRC.
This guidance is relevant to all customers who receive information or advice from HMRC. It applies to advice we provide relevant to all taxes we collect and payments we administer.
Information or advice you receive from HMRC applies:
There is no general right of appeal against advice or information we provide except where rights of appeal are set out in statute. The information and advice we provide is aimed at helping you to understand your obligations, liabilities, entitlements or the consequences of your transactions. You are not required to act on the basis of our advice for example when completing a return or paying tax.
We aim to provide information and advice that will give certainty to our customers as to the tax consequences of their transactions, their obligations or liabilities and entitlements. Our starting point is therefore that you should be able to rely on any information or advice we provide. However for information or advice you have received to be considered binding on HMRC, when contacting HMRC you must set out all the relevant facts and draw attention to all the issues. This has been described by the courts as the need for the applicant to place all his cards face up on the table. We expect you to interpret this relatively broadly, for example, by providing information on related transactions where relevant.
Under our existing powers of 'collection and management' (Section 5 of the Commissioners for Revenue and Customs Act 2005), the principles of administrative law and the Courts will ultimately determine if we are bound by advice we have given. The underlying principle is that HMRC has a duty to collect the correct amount of tax as required by statute. In the vast majority of cases advice we give will be correct in law and therefore binding on HMRC. However there are some circumstances in which our primary duty to collect tax according to the statute may mean that we can no longer be bound by advice we have given.
For example, this may occur in the following circumstances:
There may be a small number of cases where we provide information or advice that is incorrect in law. Where this happens, we will be bound by such advice provided that it is clear, unequivocal and explicit and you can demonstrate that:
Where this is the case, to apply the statute may be so unfair that it could amount to an abuse of power. But, where we have given incorrect information or advice, our primary duty will always remain to collect the correct amount of tax as required by the law and therefore there will be some circumstances where we will not be bound by the advice we have given.
Where we provide you with erroneous advice that is binding on us and subsequently notify you that it is incorrect, the established legal position is that you will only be required to start accounting for tax on the correct basis from the date of notification. All cases will be subject to any statutory time limits.
There may be certain circumstances where you have misunderstood the law and applied the wrong tax treatment when carrying out a transaction or providing information or payment to HMRC. In these circumstances, the wrong amount of tax has been collected. As HMRC has a duty to collect the correct amount of tax as required by law, the situation must be rectified for the past and for the future in order to ensure that the law is applied correctly. However, in rectifying the situation, HMRC will be bound by considerations of public law for example to treat taxpayers fairly.
For any cases of misunderstanding concerning VAT or IPT, please see extra statutory concession 3.4 Misunderstanding (Notice 48 Extra statutory concessions).