Income and Corporation Taxes Act 1988

M1 252.— Rectification of excessive set-off etc. of ACT or tax credit. U.K.

(1) If an inspector discovers that—

(a) any set-off of advance corporation tax under section 239, or

(b) any set-off or payment of tax credit,

ought not to have been made, or is or has become excessive, the inspector may make any such assessments as may in his judgment be required for recovering any tax that ought to have been paid or any payment of tax credit that ought not to have been made and generally for securing that the resulting liabilities to tax (including interest on unpaid tax) of the persons concerned are what they would have been if only such set-offs or payments had been made as ought to have been made.

(2) In any case where—

(a) interest has been paid under section 826 on a payment of tax credit; and

(b) interest ought not to have been paid on that payment, either at all or to any extent,

an assessment under this section may be made for recovering any interest that ought not to have been paid.

(3) Where—

(a) an assessment is made under this section to recover tax credit paid to a company in respect of franked investment income received by the company in an accounting period; and

(b) more than one payment of tax credit has been made in respect of that period,

any sum recovered shall as far as possible be treated as relating to a payment of tax credit made later rather than to a payment made earlier.

(4) Subsections (2) and (3) above shall have effect in relation to payments of tax credit claimed in respect of accounting periods ending after such day as may be appointed for the purpose of those subsections by order made by the Treasury, not being earlier than 31st March 1992.

(5) The Management Act shall apply to any assessment under this section for recovering a payment of tax credit or interest on such a payment as if it were an assessment to income tax for the year of assessment, or in the case of a company, corporation tax for the accounting period, in respect of which the payment was claimed, and as if that payment represented a loss of tax to the Crown; and any sum charged by any such assessment shall, subject to any appeal against the assessment, be due within 14 days after the issue of the notice of assessment.

Subordinate Legislation Made

P1 S. 252(4) power exercised: 30.9.1993 appointed for the purposes of s. 252(2)(3) by S.I. 1992/3066, art. 2(2)(b).

Modifications etc. (not altering text)

C1 S. 252 modified (27.7.1993) by 1993 c. 34, s. 80(8)

C2 S. 252 modified (16.8.1995) by The Venture Capital Trust Regulations 1995 (S.I. 1995/1979), reg. 15(4)(5)

C3 S. 252 applied (16.8.1995) by The Venture Capital Trust Regulations 1995 (S.I. 1995/1979), reg. 20

C4 S. 252 modified (31.7.1997) by Finance (No. 2) Act 1997 (c. 58), s. 35(10)

C5 See 1989 s.157(1)for reckonable date for interest charge under 1970(M) s.86where assessment made to recover corporation tax payable as the result of a claim under s.240made on or after 14March 1989. (Ceases to have effect for accounting periods ending after the day appointed for the purposes of s.86).

Marginal Citations

M1 Source—1972 s.102; (No.2) s.88(5)-(7)