13(1)If it appears to HMRC that a person in respect of whom a hold notice given to a deposit-taker is in force—E+W+N.I.
(a)has failed to pay a relevant sum, and
(b)holds an account (or more than one account) with the deposit-taker in respect of which there is a held amount in relation to that sum,
HMRC may give the deposit-taker a deduction notice in respect of that person.
(2)A “deduction notice” is a notice which—
(a)specifies the name of the person concerned,
(b)specifies one or more affected accounts held by that person with the deposit-taker, and
(c)in relation to each such specified account requires the deposit-taker to deduct and pay a qualifying amount (see sub-paragraph (6)) to the Commissioners by a day specified in the notice.
(3)Where a deduction notice specifies a particular affected account—
(a)the deduction required to be made in relation to that account by virtue of sub-paragraph (2)(c) must be made from the appropriate account, that is to say—
(i)if the deposit-taker has by virtue of the hold notice transferred an amount from the specified account into a suspense account, that suspense account, or
(ii)otherwise, the specified account, and
(b)the deposit-taker must not during the period in which the deduction notice is in force do anything, or permit anything to be done (except in accordance with paragraph (a)) that would reduce the amount standing to the credit of the appropriate account below the balance required for the purpose of making that deduction.
(4)A deduction notice must explain the effect of sub-paragraph (3)(b) and paragraph 14 (penalties).
(5)A deduction notice may not be given in respect of an account unless—
(a)the period for making an objection under paragraph 10 has expired and either no objections were made or any objection made has been decided or withdrawn, and
(b)if objections were made and decided, the period for appealing under paragraph 12 has expired and any appeal or further appeal has been finally determined.
(6)In this paragraph “qualifying amount”, in relation to an affected account, means an amount not exceeding the held amount in relation to that account (as modified, where applicable, under paragraph 9(3)(b), 11(6)(b) or 12(7)(b)).
(7)The total of the qualifying amounts specified in the deduction notice must not exceed the unpaid amount of the notified sum (see paragraph 8(8)).
(8)HMRC must—
(a)give a copy of the deduction notice to the person in respect of whom it is given, and
(b)in the case of each account in respect of which the notice is given, give a notice to each person within sub-paragraph (9) explaining that a deduction notice has been given in respect of that account and the effect of the deduction notice so far as it relates to that account.
(9)The persons mentioned in sub-paragraph (8)(b) are—
(a)if the account is a joint account, each person other than P who is a holder of the account, and
(b)any person (not falling within paragraph (a))—
(i)who is an interested third party in relation to the account whom HMRC knows will be affected by the deduction notice, and
(ii)about whom HMRC has sufficient information to enable it to give the notice under sub-paragraph (8)(b).
(10)HMRC may, by a notice given to the deposit-taker, amend or cancel the deduction notice, and where it does so it must—
(a)give a copy of the notice under this sub-paragraph to the person in respect of whom the deduction notice was given, and
(b)in the case of each account affected by the amendment or cancellation, give a notice to each person within sub-paragraph (9) explaining the effect of the amendment or cancellation so far as it relates to that account.
(11)The deduction notice—
(a)comes into force at the time it is given to the deposit-taker, and
(b)ceases to be in force at the time—
(i)the deposit-taker is given a notice cancelling it under sub-paragraph (10), or
(ii)the deposit-taker makes the final payment required by virtue of sub-paragraph (2)(c).