Income and Corporation Taxes Act 1988

827 VAT penalties etc. U.K.

M1 (1) Where, under [F1 Part IV of the Value Added Tax Act 1994], a person is liable to make a payment by way of—

(a) penalty under any of sections [F2 60 to 70]; or

(b) interest under section [F3 74]; or

(c) surcharge under section [F3 59];

the payment shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes.

[F4 (1A) Where a person is liable to make a payment by way of a penalty under any of sections 8 to 11 of the Finance Act 1994 (penalties relating to excise), that payment shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes.]

[F5 (1B) Where a person is liable to make a payment by way of—

(a) penalty under any of paragraphs 12 to 19 of Schedule 7 to the Finance Act 1994 (insurance premium tax), or

(b) interest under paragraph 21 of that Schedule,

the payment shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes.]

[F6 (1C) Where a person is liable to make a payment by way of—

(a) penalty under Part V of Schedule 5 to the Finance Act 1996 (landfill tax), or

(b) interest under paragraph 26 or 27 of that Schedule,

the payment shall not be allowed as a deduction in computing any income, profits or losses for any tax purposes.]

(2) A sum paid to any person by way of supplement under section [F7 79 of that Act] shall be disregarded for all purposes of corporation tax and income tax.

Textual Amendments

F1 Words in s. 827(1) substituted (1.9.1994) by Value Added Tax Act 1994 (c. 23), s. 101(1), Sch. 14 para. 10(2)(a)

F2 Words in s. 827(1)(a) substituted (1.9.1994) by Value Added Tax Act 1994 (c. 23), s. 101(1), Sch. 14 para. 10(2)(b)

F3 Words in s. 827(1)(b)(c) substituted (1.9.1994) by Value Added Tax Act 1994 (c. 23), s. 101(1), Sch. 14 para. 10(2)(c)

F4 S. 827(1A) inserted (1.11.1994 for specified purposes and 1.1.1995 otherwise) by Finance Act 1994 (c. 9), ss. 18(7), 19(1) (with s. 19(3)); S.I. 1994/2679, arts. 2, 3 (with art. 4(3))

F5 S. 827(1B) inserted (3.5.1994) by Finance Act 1994 (c. 9), Sch. 7 para. 31

F6 S. 827(1C) inserted (29.4.1996) by Finance Act 1996 (c. 8), Sch. 5 para. 40

F7 Words in s. 827(2) substituted (1.9.1994) by Value Added Tax Act 1994 (c. 23), s. 101(1), Sch. 14 para. 10(2)(d)

Marginal Citations

M1 Source—1986 s.53.