SCHEDULE 56Penalty for failure to make payments on time
Suspension of penalty during currency of agreement for deferred payment
10
(1)
This paragraph applies if—
(a)
P fails to pay an amount of tax when it becomes due and payable,
(b)
P makes a request to HMRC that payment of the amount of tax be deferred, and
(c)
HMRC agrees that payment of that amount may be deferred for a period (“the deferral period”).
(2)
If P would (apart from this sub-paragraph) become liable, between the date on which P makes the request and the end of the deferral period, to a penalty under any paragraph of this Schedule for failing to pay that amount, P is not liable to that penalty.
(3)
But if—
(a)
P breaks the agreement (see sub-paragraph (4)), and
(b)
HMRC serves on P a notice specifying any penalty to which P would become liable apart from sub-paragraph (2),
P becomes liable, at the date of the notice, to that penalty.
(4)
P breaks an agreement if—
(a)
P fails to pay the amount of tax in question when the deferral period ends, or
(b)
the deferral is subject to P complying with a condition (including a condition that part of the amount be paid during the deferral period) and P fails to comply with it.
(5)
If the agreement mentioned in sub-paragraph (1)(c) is varied at any time by a further agreement between P and HMRC, this paragraph applies from that time to the agreement as varied.