Finance Bill - continued        House of Lords
SCHEDULE 6, CLIMATE CHANGE LEVY - continued

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  PART V
  REGISTRATION
 
Requirement to be registered
     53. - (1) A person is required to be registered with the Commissioners for the purposes of the levy if a taxable supply is made in respect of which he is the person liable to account for the levy charged.
 
      (2) The Commissioners shall, for the purposes of sub-paragraph (1) and in accordance with the provisions of this Part of this Schedule, establish and maintain a register of persons liable to account for levy.
 
      (3) The Commissioners shall keep such information in the register as they consider appropriate for the care and management of the levy.
 
 
Interpretation of Part V
     54. In this Part of this Schedule-
 
 
    (a) references to the register are references to the register maintained under paragraph 53(2);
 
    (b) references to registering a person are references to registering him in that register; and
 
    (c) references to a person's registration are references to his registration in that register.
 
Notification of registrability etc.
     55. - (1) A person who-
 
 
    (a) intends to make, or have made to him, any taxable supply in respect of which (if made) he will be the person liable to account for the levy charged, or
 
    (b) is required to be registered for the purposes of the levy,
       shall (if he is not so registered) notify the Commissioners of that fact.
 
      (2) Subject to sub-paragraphs (5) and (6), a person who fails to comply with sub-paragraph (1) shall be liable to a penalty.
 
      (3) The amount of the penalty shall be-
 
 
    (a) the amount equal to 5 per cent. of the relevant levy; or
 
    (b) if it is greater or the circumstances are such that there is no relevant levy, £250.
      (4) In sub-paragraph (3) "relevant levy" means the levy (if any) for which the person in question is liable to account in respect of taxable supplies made in the period which-
 
 
    (a) begins with the date with effect from which he is required to be registered for the purposes of the levy; and
 
    (b) ends with the date on which the Commissioners received notification of, or otherwise first became aware of, the fact that he was required to be registered.
      (5) A failure to comply with sub-paragraph (1) shall not give rise to any liability to a penalty under this paragraph if the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the failure.
 
      (6) Where, by reason of any conduct falling within sub-paragraph (2)-
 
 
    (a) a person is convicted of an offence (whether under this Act or otherwise), or
 
    (b) a person is assessed to a penalty under paragraph 98 (penalty for evasion),
       that person shall not by reason of that conduct be liable also to a penalty under this paragraph.
 
 
Form of registration
     56. - (1) The Commissioners shall register a person if-
 
 
    (a) they receive from him a notification given in pursuance of paragraph 55, or
 
    (b) although they have not received from him such a notification, it appears to them that he is required to be registered.
  Where the Commissioners register a person who is required to be registered, they shall register him with effect from the time when the requirement arose.
 
      (2) Where any two or more bodies corporate are members of the same group they shall be registered together as one person in the name of the representative member.
 
      (3) The registration of a body corporate carrying on a business in several divisions may, if the body corporate so requests and the Commissioners see fit, be in the names of those divisions.
 
      (4) The registration of-
 
 
    (a) any two or more persons carrying on a business in partnership, or
 
    (b) an unincorporated body,
       may be in the name of the firm or body concerned.
 
 
Notification of loss or prospective loss of registrability
     57. - (1) Where a person who has become liable to give a notification by virtue of paragraph 55 ceases (whether before or after being registered for the purposes of the levy) to intend to make, or to intend to have made to him, taxable supplies in respect of which (if made) he would be the person liable to account for the levy charged, he shall notify the Commissioners of that fact.
 
      (2) A person who fails to comply with sub-paragraph (1) shall be liable to a penalty of £250.
 
 
Cancellation of registration
     58. - (1) If the Commissioners are satisfied that a registered person-
 
 
    (a) has ceased to make, or have made to him, taxable supplies on which he is liable to account for the levy charged, and
 
    (b) does not intend to make, or have made to him, any such supplies,
       they may cancel his registration with effect from such time after he last made, or had made to him, taxable supplies as appears to them to be appropriate.
 
      (2) Sub-paragraph (1) applies whether or not the registered person has notified the Commissioners under paragraph 57.
 
      (3) The Commissioners shall be under a duty to exercise the power conferred by sub-paragraph (1) with effect from any time if, where the power is exercisable, they are satisfied that the conditions specified in sub-paragraph (4) are satisfied and were or will be satisfied at that time.
 
      (4) Those conditions are-
 
 
    (a) that the person in question has given a notification under paragraph 57;
 
    (b) that no levy due from that person, and no amount recoverable as if it were levy, remains unpaid;
 
    (c) that no tax credit to which that person is entitled by virtue of any tax credit regulations is outstanding; and
 
    (d) that that person is not subject to any outstanding liability to make a return for the purposes of the levy.
      (5) Where-
 
 
    (a) a registered person notifies the Commissioners under paragraph 57, and
 
    (b) they are satisfied that (if he had not been registered) he would not have been required to be registered at any time since the time when he was registered,
       they shall cancel his registration with effect from the date of his registration.
 
 
Correction of the register etc.
     59. - (1) The Commissioners may by regulations make provision for and with respect to the correction of entries in the register.
 
      (2) Regulations under this paragraph may, to such extent as appears to the Commissioners appropriate for keeping the register up to date, make provision requiring-
 
 
    (a) registered persons, and
 
    (b) persons who are required to be registered,
       to notify the Commissioners of changes in circumstances relating to themselves, their businesses or any other matter with respect to which particulars are contained in the register (or would be, were the person registered).
 
 
Supplemental regulations about notifications
     60. - (1) For the purposes of any provision made by or under this Part of this Schedule for any matter to be notified to the Commissioners, regulations made by the Commissioners may make provision-
 
 
    (a) as to the time within which the notification is to be given;
 
    (b) as to the form and manner in which the notification is to be given; and
 
    (c) as to the information and other particulars to be contained in or provided with any notification.
      (2) For those purposes the Commissioners may also by regulations impose obligations requiring a person who has given a notification to notify the Commissioners if any information contained in or provided in connection with that notification is or becomes inaccurate.
 
      (3) The power under this paragraph to make regulations as to the time within which any notification is to be given shall include power to authorise the Commissioners to extend the time for the giving of a notification.
 
 
Publication of information on the register
     61. - (1) The Commissioners may publish, by such means as they think fit, any information which-
 
 
    (a) is derived from the register; and
 
    (b) falls within any of the descriptions set out below.
      (2) The descriptions are-
 
 
    (a) the names of registered persons;
 
    (b) the fact (where it is the case) that the registered person is a body corporate which is a member of a group;
 
    (c) the names of the other bodies corporate which are members of the group.
      (3) Information may be published in accordance with this paragraph notwithstanding any obligation not to disclose the information that would otherwise apply.
 
  PART VI
  CREDITS AND REPAYMENTS
 
Tax credits
     62. - (1) The Commissioners may, in accordance with the following provisions of this paragraph, by regulations make provision in relation to cases where-
 
 
    (a) after a taxable supply has been made, there is such a change in circumstances or any person's intentions that, if the changed circumstances or intentions had existed at the time the supply was made, the supply would not have been a taxable supply;
 
    (b) after a supply of a taxable commodity is made on the basis that it is a taxable supply, it is determined that the supply was not (to any extent) a taxable supply;
 
    (c) after a taxable supply has been made on the basis that it was neither a half-rate supply nor a reduced-rate supply, it is determined that the supply was (to any extent) a half-rate or reduced-rate supply;
 
    (d) levy is accounted for on a half-rate supply as if the supply were neither a half-rate supply nor a reduced-rate supply;
 
    (e) after a charge to levy has arisen on a supply of a taxable commodity ("the original commodity") to a person who uses the commodity supplied in producing taxable commodities primarily for his own consumption, that person makes supplies of any of the commodities in whose production he has used the original commodity;
 
    (f) after a person has become entitled to a debt as a result of making a taxable supply, the debt turns out to be bad (in whole or in part);
 
    (g) the making of a taxable supply gives rise to a double charge to levy within the meaning of paragraph 21.
      (2) The provision that may be made in relation to any such case as is mentioned in sub-paragraph (1) is provision-
 
 
    (a) for such person as may be specified in the regulations to be entitled to a tax credit in respect of any levy charged on the supply (or, in such a case as is mentioned in sub-paragraph (1)(g), one of the supplies) in question;
 
    (b) for a tax credit to which any person is entitled under the regulations to be brought into account when he is accounting for levy due from him for such accounting period or periods as may be determined in accordance with the regulations; and
 
    (c) for a person entitled to a tax credit to be entitled, in any prescribed case where he cannot bring the tax credit into account so as to set it against a liability to levy, to a repayment of levy of an amount so determined.
      (3) Regulations under this paragraph may contain any or all of the following provisions-
 
 
    (a) provision making any entitlement to a tax credit conditional on the making of a claim by such person, within such period and in such manner as may be prescribed;
 
    (b) provision making entitlement to bring a tax credit into account, or to receive a repayment in respect of such a credit, conditional on compliance with such requirements (including the making of a claim) as may be determined in accordance with the regulations;
 
    (c) provision requiring a claim for a tax credit to be evidenced and quantified by reference to such records and other documents as may be so determined;
 
    (d) provision requiring a person claiming any entitlement to a tax credit to keep, for such period and in such form and manner as may be so determined, those records and documents and a record of such information relating to the claim as may be so determined;
 
    (e) provision for the withdrawal of a tax credit where any requirement of the regulations is not complied with;
 
    (f) provision for interest at the rate applicable under section 197 of the Finance Act 1996 to be treated as added, for such period and for such purposes as may be prescribed, to the amount of any tax credit;
 
    (g) provision for determining whether, and to what extent, a debt is to be taken as bad;
 
    (h) provision for the withdrawal of a tax credit to which a person has become entitled in a case within sub-paragraph (1)(f) where any part of the debt that has been taken to be bad falls to be regarded as not having been bad;
 
    (i) provision for determining whether, and to what extent, any part of a debt that has been taken to be bad should be regarded as not having been bad;
 
    (j) provision for anything falling to be determined in accordance with the regulations to be determined by reference to a general or specific direction given in accordance with the regulations by the Commissioners.
      (4) Regulations made under this paragraph shall have effect subject to the provisions of paragraph 64.
 
 
Repayments of overpaid levy
     63. - (1) Where a person has paid an amount to the Commissioners by way of levy which was not levy due to them, they shall be liable to repay the amount to him.
 
      (2) The Commissioners shall not be liable to repay an amount under this paragraph if, or to the extent that, any person has become entitled to a tax credit in respect of that amount by virtue of tax credit regulations.
 
      (3) The Commissioners shall not be liable to repay an amount under this paragraph except on the making of a claim for that purpose.
 
      (4) A claim under this paragraph must be made in such form and manner, and must be supported by such documentary evidence, as may be required by regulations made by the Commissioners.
 
      (5) The preceding provisions of this paragraph are subject to the provisions of paragraph 64.
 
      (6) Except as provided by this paragraph or tax credit regulations, the Commissioners shall not, by virtue of the fact that it was not levy due to them, be liable to repay any amount paid to them by way of levy.
 
 
Supplemental provisions about repayments etc.
     64. - (1) The Commissioners shall not be liable, on any claim for a repayment of levy, to repay any amount paid to them more than three years before the making of the claim.
 
      (2) It shall be a defence to any claim for a repayment of an amount of levy that the repayment of that amount would unjustly enrich the claimant.
 
      (3) Sub-paragraph (4) applies for the purposes of sub-paragraph (2) where-
 
 
    (a) there is an amount paid by way of levy which (apart from sub-paragraph (2)) would fall to be the subject of a repayment of levy to any person ("person A"); and
 
    (b) the whole or a part of the cost of the payment of that amount to the Commissioners has, for practical purposes, been borne by a person other than person A.
      (4) Where, in a case to which this sub-paragraph applies, loss or damage has been or may be incurred by person A as a result of mistaken assumptions made in his case about the operation of any provisions relating to levy, that loss or damage shall be disregarded, except to the extent of the quantified amount, in the making of any determination as to-
 
 
    (a) whether or to what extent the repayment of an amount to person A would enrich him; or
 
    (b) whether or to what extent any enrichment of person A would be unjust.
      (5) In sub-paragraph (4) "the quantified amount" means the amount (if any) which is shown by person A to constitute the amount that would appropriately compensate him for loss or damage shown by him to have resulted, for any business carried on by him, from the making of the mistaken assumptions.
 
      (6) The reference in sub-paragraph (4) to provisions relating to levy is a reference to any provisions of-
 
 
    (a) any enactment or subordinate legislation (whether or not still in force) which relates to the levy or to any matter connected with it; or
 
    (b) any notice published by the Commissioners under or for the purposes of any enactment or subordinate legislation relating to the levy.
 
Reimbursement arrangements
     65. - (1) The Commissioners may by regulations make provision for reimbursement arrangements made by any person to be disregarded for the purposes of paragraph 64(2) except where the arrangements-
 
 
    (a) contain such provision as may be required by the regulations; and
 
    (b) are supported by such undertakings to comply with the provisions of the arrangements as may be required by the regulations to be given to the Commissioners.
      (2) In this paragraph "reimbursement arrangements" means any arrangements for the purposes of a claim to a repayment of levy which-
 
 
    (a) are made by any person for the purpose of securing that he is not unjustly enriched by the repayment of any amount in pursuance of the claim; and
 
    (b) provide for the reimbursement of persons who have for practical purposes borne the whole or any part of the cost of the original payment of that amount to the Commissioners.
      (3) Without prejudice to the generality of sub-paragraph (1), the provision that may be required by regulations under this paragraph to be contained in reimbursement arrangements includes-
 
 
    (a) provision requiring a reimbursement for which the arrangements provide to be made within such period after the repayment to which it relates as may be specified in the regulations;
 
    (b) provision for the repayment of amounts to the Commissioners where those amounts are not reimbursed in accordance with the arrangements;
 
    (c) provision requiring interest paid by the Commissioners on any amount repaid by them to be treated in the same way as that amount for the purposes of any requirement under the arrangements to make reimbursement or to repay the Commissioners;
 
    (d) provision requiring such records relating to the carrying out of the arrangements as may be described in the regulations to be kept and produced to the Commissioners, or to an officer of theirs.
      (4) Regulations under this paragraph may impose obligations on such persons as may be specified in the regulations-
 
 
    (a) to make the repayments to the Commissioners that they are required to make in pursuance of any provisions contained in any reimbursement arrangements by virtue of sub-paragraph (3)(b) or (c);
 
    (b) to comply with any requirements contained in any such arrangements by virtue of sub-paragraph (3)(d).
      (5) Regulations under this paragraph may make provision for the form and manner in which, and the times at which, undertakings are to be given to the Commissioners in accordance with the regulations; and any such provision may allow for those matters to be determined by the Commissioners in accordance with the regulations.
 
 
Interest payable by the Commissioners
     66. - (1) Where, due to an error on the part of the Commissioners, a person-
 
 
    (a) has paid to them by way of levy an amount which was not levy due and which they are in consequence liable to repay to him,
 
    (b) has failed to claim a repayment of levy to which he was entitled, under any tax credit regulations, in respect of any tax credits, or
 
    (c) has suffered delay in receiving payment of an amount due to him from them in connection with levy,
       then, if and to the extent that they would not be liable to do so apart from this paragraph, they shall (subject to the following provisions of this paragraph) pay interest to him on that amount for the applicable period.
 
      (2) In sub-paragraph (1), the reference in paragraph (a) to an amount which the Commissioners are liable to repay in consequence of the making of a payment that was not due is a reference to only so much of that amount as is the subject of a claim that the Commissioners are required to satisfy or have satisfied.
 
      (3) In that sub-paragraph the amounts referred to in paragraph (c)-
 
 
    (a) do not include any amount payable under this paragraph;
 
    (b) do not include the amount of any interest for which provision is made by virtue of paragraph 62(3)(f); but
 
    (c) do include any amount due (in respect of an adjustment of overpaid interest) by way of a repayment under paragraph 87(3) or 110(3).
      (4) The applicable period, in a case falling within sub-paragraph (1)(a), is the period-
 
 
    (a) beginning with the date on which the payment is received by the Commissioners; and
 
    (b) ending with the date on which they authorise payment of the amount on which the interest is payable.
      (5) The applicable period, in a case falling within sub-paragraph (1)(b) or (c), is the period-
 
 
    (a) beginning with the date on which, apart from the error, the Commissioners might reasonably have been expected to authorise payment of the amount on which the interest is payable; and
 
    (b) ending with the date on which they in fact authorise payment of that amount.
      (6) In determining the applicable period for the purposes of this paragraph there shall be left out of account any period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control.
 
      (7) The reference in sub-paragraph (6) to a period by which the Commissioners' authorisation of the payment of interest is delayed by circumstances beyond their control includes, in particular, any period which is referable to-
 
 
    (a) any unreasonable delay in the making of any claim for the payment or repayment of the amount on which interest is claimed;
 
    (b) any failure by any person to provide the Commissioners-
 
      (i) at or before the time of the making of a claim, or
 
      (ii) subsequently in response to a request for information by the Commissioners,
 
    with all the information required by them to enable the existence and amount of the claimant's entitlement to a payment or repayment, and to interest on that payment or repayment, to be determined; and
 
    (c) the making, as part of or in association with any claim for the payment or repayment of the amount on which interest is claimed, of a claim to anything to which the claimant was not entitled.
      (8) In determining for the purposes of sub-paragraph (7) whether any period of delay is referable to a failure by any person to provide information in response to a request by the Commissioners, there shall be taken to be so referable, except so far as may be provided for by regulations, any period which-
 
 
    (a) begins with the date on which the Commissioners require that person to provide information which they reasonably consider relevant to the matter to be determined; and
 
    (b) ends with the earliest date on which it would be reasonable for the Commissioners to conclude-
 
      (i) that they have received a complete answer to their request for information;
 
      (ii) that they have received all that they need in answer to that request; or
 
      (iii) that it is unnecessary for them to be provided with any information in answer to that request.
      (9) The Commissioners shall not be liable to pay interest under this paragraph except on the making of a claim for that purpose.
 
      (10) A claim under this paragraph must be in writing and must be made not more than three years after the end of the applicable period to which it relates.
 
      (11) References in this paragraph-
 
 
    (a) to receiving payment of any amount from the Commissioners, or
 
    (b) to the authorisation by the Commissioners of the payment of any amount,
       include references to the discharge by way of set-off (whether in accordance with regulations under paragraph 73 or 74 or otherwise) of the Commissioners' liability to pay that amount.
 
      (12) Interest under this paragraph shall be payable at the rate applicable under section 197 of the Finance Act 1996.
 
 
Assessment for excessive repayment
     67. - (1) Where-
 
 
    (a) any amount has been paid at any time to any person by way of a repayment of levy, and
 
    (b) the amount paid exceeded the amount which the Commissioners were liable at that time to repay to that person,
       the Commissioners may, to the best of their judgement, assess the excess paid to that person and notify it to him.
 
      (2) Where-
 
 
    (a) any amount has been paid to any person by way of repayment of levy,
 
    (b) the repayment is in respect of a tax credit the entitlement to which arose in a case falling within paragraph 62(1)(f) (tax credit where all or part of a debt is bad),
 
    (c) the whole or any part of the credit is withdrawn on account of any part of the debt taken as bad falling to be regarded as not having been bad, and
 
    (d) the amount paid exceeded the amount which the Commissioners would have been liable to repay to that person had that withdrawal been taken into account,
       the Commissioners may, to the best of their judgement, assess the excess paid to that person and notify it to him.
 
      (3) Where any person is liable to pay any amount to the Commissioners in pursuance of an obligation imposed by virtue of paragraph 65(4)(a), the Commissioners may, to the best of their judgement, assess the amount due from that person and notify it to him.
 
      (4) Subject to sub-paragraph (5), where-
 
 
    (a) an assessment is made on any person under this paragraph in respect of a repayment of levy made in relation to any accounting period, and
 
    (b) the Commissioners have power under Part VII of this Schedule to make an assessment on that person to an amount of levy due from that person for that period,
       the assessments may be combined and notified to him as one assessment.
 
      (5) A notice of a combined assessment under sub-paragraph (4) must separately identify the amount being assessed in respect of repayments of levy.
 
 
Assessment for overpayments of interest
     68. Where-
 
 
    (a) any amount has been paid to any person by way of interest under paragraph 66, but
 
    (b) that person was not entitled to that amount under that paragraph,
       the Commissioners may, to the best of their judgement, assess the amount so paid to which that person was not entitled and notify it to him.
 
 
Assessments under paragraphs 67 and 68
     69. - (1) An assessment under paragraph 67 or 68 shall not be made more than two years after the time when evidence of facts sufficient in the opinion of the Commissioners to justify the making of the assessment comes to the knowledge of the Commissioners.
 
      (2) Where an amount has been assessed and notified to any person under paragraph 67 or 68, it shall be recoverable as if it were levy due from him.
 
      (3) Sub-paragraph (2) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
 
 
Interest on amounts assessed
     70. - (1) Where an assessment is made under paragraph 67 or 68, the whole of the amount assessed shall carry interest, for the period specified in sub-paragraph (2), as follows-
 
 
    (a) so much of that amount as represents the amount of a tax credit claimed by a person who was not entitled to it (but not any amount assessed under paragraph 67(2)) shall carry penalty interest;
 
    (b) so much of that amount as does not carry penalty interest under paragraph (a) shall carry interest at the rate applicable under section 197 of the Finance Act 1996.
      (2) That period is the period which-
 
 
    (a) begins with the day after that on which the person is notified of the assessment; and
 
    (b) ends with the day before that on which payment is made of the amount assessed.
      (3) Interest under this paragraph shall be paid without any deduction of income tax.
 
      (4) Penalty interest under this paragraph shall be compound interest calculated-
 
 
    (a) at the penalty rate, and
 
    (b) with monthly rests.
      (5) For this purpose the penalty rate is the rate found by-
 
 
    (a) taking the rate applicable under section 197 of the Finance Act 1996 for the purposes of sub-paragraph (1)(b); and
 
    (b) adding 10 percentage points to that rate.
      (6) Where a person is liable under this paragraph to pay any penalty interest, the Commissioners or, on appeal, an appeal tribunal may reduce the amount payable to such amount (including nil) as they think proper.
 
      (7) Subject to sub-paragraph (8), where the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct giving rise to the liability to pay penalty interest, that is a matter which (among other things) may be taken into account under sub-paragraph (6).
 
      (8) In determining whether there is a reasonable excuse for the purposes of sub-paragraph (7), no account shall be taken of any of the following matters, that is to say-
 
 
    (a) the insufficiency of the funds available to any person for paying any levy due or for paying the amount of the interest;
 
    (b) the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of levy;
 
    (c) the fact that the person liable to pay the interest or a person acting on his behalf has acted in good faith.
      (9) In the case of interest reduced by the Commissioners under sub-paragraph (6) an appeal tribunal, on an appeal relating to the interest, may cancel the whole or any part of the reduction made by the Commissioners.
 
 
Assessments to interest under paragraph 70
     71. - (1) Where any person is liable to interest under paragraph 70 the Commissioners may assess the amount due by way of interest and notify it to him accordingly.
 
      (2) Without prejudice to the power to make assessments under this paragraph for later periods, the interest to which an assessment under this paragraph may relate shall be confined to interest for a period of no more than two years ending with the time when the assessment under this paragraph is made.
 
      (3) Where an amount has been assessed and notified to any person under this paragraph it shall be recoverable as if it were levy due from him.
 
      (4) Sub-paragraph (3) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
 
      (5) Where an assessment is made under this paragraph to an amount of interest under paragraph 70-
 
 
    (a) the notice of assessment shall specify a date, not later than the date of the notice of assessment, to which the amount of interest which is assessed is calculated; and
 
    (b) if the interest continues to accrue after that date, a further assessment or further assessments may be made under this paragraph in respect of the amounts so accruing.
      (6) Where-
 
 
    (a) an assessment to interest is made specifying a date for the purposes of sub-paragraph (5)(a), and
 
    (b) within such period as may for the purposes of this sub-paragraph have been notified by the Commissioners to the person liable for the interest, the amount on which the interest is payable is paid,
       that amount shall be deemed for the purposes of any further liability to interest to have been paid on the specified date.
 
 
Supplementary assessments
     72. If it appears to the Commissioners that the amount which ought to have been assessed in an assessment under paragraph 67, 68 or 71 exceeds the amount which was so assessed, then-
 
 
    (a) under the same paragraph as that assessment was made, and
 
    (b) on or before the last day on which that assessment could have been made,
       the Commissioners may make a supplementary assessment of the amount of the excess and notify the person concerned accordingly.
 
 
Set-off of or against amounts due under this Schedule
     73. - (1) The Commissioners may by regulations make provision in relation to any case where-
 
 
    (a) a person is under a duty to pay to the Commissioners at any time an amount or amounts in respect of levy; and
 
    (b) the Commissioners are under a duty to pay to that person at the same time an amount or amounts in respect of levy or any of the other taxes under their care and management.
      (2) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(b), the latter shall be set off against the former.
 
      (3) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(b) exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(a), the Commissioners may set off the latter in paying the former.
 
      (4) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) is the same as the total of the amount or amounts mentioned in sub-paragraph (1)(b) no payment need be made in respect of the former or the latter.
 
      (5) Regulations under this paragraph may provide for any limitation on the time within which the Commissioners are entitled to take steps for recovering any amount due to them in respect of levy to be disregarded, in such cases as may be described in the regulations, in determining whether any person is under such a duty to pay as is mentioned in sub-paragraph (1)(a).
 
      (6) Regulations under this paragraph may include provision treating any duty to pay mentioned in sub-paragraph (1) as discharged accordingly.
 
      (7) References in sub-paragraph (1) to an amount in respect of a particular tax include references not only to an amount of tax itself but also to other amounts such as interest and penalties that are or may be recovered as if they were amounts of tax.
 
      (8) In this paragraph "tax" includes duty.
 
 
Set-off of or against other taxes and duties
     74. - (1) The Commissioners may by regulations make provision in relation to any case where-
 
 
    (a) a person is under a duty to pay to the Commissioners at any time an amount or amounts in respect of any tax (or taxes) under their care and management other than levy; and
 
    (b) the Commissioners are under a duty, at the same time, to make any repayment of levy to that person or to make any other payment to him of any amount or amounts in respect of levy.
      (2) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(b), the latter shall be set off against the former.
 
      (3) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(b) exceeds the total of the amount or amounts mentioned in sub-paragraph (1)(a), the Commissioners may set off the latter in paying the former.
 
      (4) Regulations under this paragraph may provide that if the total of the amount or amounts mentioned in sub-paragraph (1)(a) is the same as the total of the amount or amounts mentioned in sub-paragraph (1)(b) no payment need be made in respect of the former or the latter.
 
      (5) Regulations under this paragraph may provide for any limitation on the time within which the Commissioners are entitled to take steps for recovering any amount due to them in respect of any of the taxes under their care and management to be disregarded, in such cases as may be described in the regulations, in determining whether any person is under such a duty to pay as is mentioned in sub-paragraph (1)(a).
 
      (6) Regulations under this paragraph may include provision treating any duty to pay mentioned in sub-paragraph (1) as discharged accordingly.
 
      (7) References in sub-paragraph (1) to an amount in respect of a particular tax include references not only to an amount of tax itself but also to other amounts such as interest and penalties that are or may be recovered as if they were amounts of tax.
 
      (8) In this paragraph "tax" includes duty.
 
 
Restriction on powers to provide for set-off
     75. - (1) Regulations made under paragraph 73 or 74 shall not require any such amount or amounts as are mentioned in sub-paragraph (1)(b) of that paragraph ("the credit") to be set against any such amount or amounts as are mentioned in sub-paragraph (1)(a) of that paragraph ("the debit") in any case where-
 
 
    (a) an insolvency procedure has been applied to the person entitled to the credit;
 
    (b) the credit became due after that procedure was so applied; and
 
    (c) the liability to pay the debit either arose before that procedure was so applied or (having arisen afterwards) relates to, or to matters occurring in the course of, the carrying on of any business at times before the procedure was so applied.
      (2) For the purposes of this paragraph, an insolvency procedure is applied to a person if-
 
 
    (a) a bankruptcy order, winding-up order or administration order is made in relation to that person or an award of sequestration is made on that person's estate;
 
    (b) that person is put into administrative receivership;
 
    (c) that person passes a resolution for voluntary winding up;
 
    (d) any voluntary arrangement approved in accordance with-
 
      (i) Part I or VIII of the Insolvency Act 1986, or
 
      (ii) Part II or Chapter II of Part VIII of the Insolvency (Northern Ireland) Order 1989,
 
    comes into force in relation to that person;
 
    (e) a deed of arrangement registered in accordance with-
 
      (i) the Deeds of Arrangement Act 1914, or
 
      (ii) Chapter I of Part VIII of that Order,
 
    takes effect in relation to that person;
 
    (f) a person is appointed as the interim receiver of some or all of that person's property under section 286 of the Insolvency Act 1986 or Article 259 of the Insolvency (Northern Ireland) Order 1989;
 
    (g) a person is appointed as the provisional liquidator in relation to that person under section 135 of that Act or Article 115 of that Order;
 
    (h) an interim order is made under Part VIII of that Act, or Chapter II of Part VIII of that Order, in relation to that person; or
 
    (i) that person's estate becomes vested in any other person as that person's trustee under a trust deed (within the meaning of the Bankruptcy (Scotland) Act 1985).
      (3) In this paragraph references, in relation to any person, to the application of an insolvency procedure to that person shall not include-
 
 
    (a) the making of a bankruptcy order, winding-up order, administration order or award of sequestration at a time when any such arrangement or deed as is mentioned in paragraph (d), (e) or (i) of sub-paragraph (2) is in force in relation to that person;
 
    (b) the making of a winding-up order at any of the following times, that is to say-
 
      (i) immediately upon the discharge of an administration order made in relation to that person;
 
      (ii) when that person is being wound up voluntarily;
 
      (iii) when that person is in administrative receivership;
 
    or
 
    (c) the making of an administration order in relation to that person at any time when that person is in administrative receivership.
      (4) For the purposes of this paragraph a person shall be regarded as being in administrative receivership throughout any continuous period for which (disregarding any temporary vacancy in the office of receiver) there is an administrative receiver of that person.
 
      (5) In this paragraph-
 
 
    "administration order" means an administration order under section 8 of the Insolvency Act 1986 or Article 21 of the Insolvency (Northern Ireland) Order 1989;
 
    "administrative receiver" means an administrative receiver within the meaning of section 251 of that Act or Article 5(1) of that Order.
 
Part VI: supplemental provisions
     76. - (1) Any notification of an assessment under any provision of this Part of this Schedule to a person's representative shall be treated for the purposes of this Schedule as notification to the person in relation to whom the representative acts.
 
      (2) In this paragraph "representative", in relation to any person, means-
 
 
    (a) any of that person's personal representatives;
 
    (b) that person's trustee in bankruptcy or liquidator;
 
    (c) any person holding office as a receiver in relation to that person or any of his property;
 
    (d) that person's tax representative or any other person for the time being acting in a representative capacity in relation to that person.
      (3) In this paragraph "trustee in bankruptcy" includes, as respects Scotland-
 
 
    (a) an interim or permanent trustee (within the meaning of the Bankruptcy (Scotland) Act 1985); and
 
    (b) a trustee acting under a trust deed (within the meaning of that Act).
      (4) The powers conferred by paragraphs 73 and 74 are without prejudice to any power of the Commissioners to provide by tax credit regulations for any amount to be set against another.
 
  PART VII
  RECOVERY AND INTEREST
 
Recovery of levy as debt due
     77. Levy shall be recoverable as a debt due to the Crown.
 
 
Assessments of amounts of levy due
     78. - (1) Where it appears to the Commissioners-
 
 
    (a) that any period is an accounting period by reference to which a person is liable to account for levy,
 
    (b) that any levy for which that person is liable to account by reference to that period has become due, and
 
    (c) that there has been a default by that person that falls within sub-paragraph (2),
       they may assess the amount of levy due from that person for that period to the best of their judgement and notify that amount to that person.
 
      (2) The defaults falling within this sub-paragraph are-
 
 
    (a) any failure to make a return required to be made by any provision made by or under this Schedule;
 
    (b) any failure to keep any documents necessary to verify returns required to be made under any such provision;
 
    (c) any failure to afford the facilities necessary to verify returns required to be made under any such provision;
 
    (d) the making, in purported compliance with any requirement of any such provision to make a return, of an incomplete or incorrect return;
 
    (e) any failure to comply with a requirement imposed by or under Part V of this Schedule (registration).
      (3) Where it appears to the Commissioners that a default falling within sub-paragraph (2) is a default by a person on whom the requirement to make a return is imposed in his capacity as the representative of another person, sub-paragraph (1) shall apply as if the reference to the amount of levy due included a reference to any levy due from that other person.
 
      (4) In a case where-
 
 
    (a) the Commissioners have made an assessment for any accounting period as a result of any person's failure to make a return for that period,
 
    (b) the levy assessed has been paid but no proper return has been made for that period,
 
    (c) as a result of a failure (whether by that person or a representative of his) to make a return for a later accounting period, the Commissioners find it necessary to make another assessment under this paragraph in relation to the later period, and
 
    (d) the Commissioners think it appropriate to do so in the light of the absence of a proper return for the earlier period,
       they may, in the assessment in relation to the later period, specify an amount of levy due that is greater than the amount that they would have considered to be appropriate had they had regard only to the later period.
 
      (5) Where an amount has been assessed and notified to any person under this paragraph, it shall be recoverable on the basis that it is an amount of levy due from him.
 
      (6) Sub-paragraph (5) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
 
 
Supplementary assessments
     79. - (1) If, where an assessment has been notified to any person under paragraph 78 or this paragraph, it appears to the Commissioners that the amount which ought to have been assessed as due for any accounting period exceeds the amount that has already been assessed, the Commissioners may make a supplementary assessment of the amount of the excess and notify that person accordingly.
 
      (2) Where an amount has been assessed and notified to any person under this paragraph it shall be recoverable on the basis that it is an amount of levy due from him.
 
      (3) Sub-paragraph (2) does not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
 
 
Time limits for assessments
     80. - (1) An assessment under paragraph 78 or 79 of an amount of levy due for any accounting period-
 
 
    (a) shall not be made more than two years after the end of the accounting period unless it is made within the period mentioned in sub-paragraph (2); and
 
    (b) subject to sub-paragraph (3), shall not in any event be made more than three years after the end of that accounting period.
      (2) The period referred to in sub-paragraph (1)(a) is the period of one year after evidence of facts sufficient in the Commissioners' opinion to justify the making of the assessment first came to their knowledge.
 
      (3) Subject to sub-paragraph (4), where levy has been lost-
 
 
    (a) as a result of any conduct for which a person has been convicted of an offence involving fraud,
 
    (b) in circumstances giving rise to liability to a penalty under paragraph 55 (failure to notify of registrability etc.), or
 
    (c) as a result of conduct falling within paragraph 98(1) (evasion),
       that levy may be assessed under paragraph 78 or 79 as if, in sub-paragraph (1)(b) above, for "three years" there were substituted "twenty years".
 
      (4) Where, after a person's death, the Commissioners propose to assess an amount of levy as due by reason of some conduct of the deceased-
 
 
    (a) the assessment shall not be made more than three years after the death; and
 
    (b) if the circumstances are as set out in sub-paragraph (3)-
 
      (i) the modification of sub-paragraph (1) contained in that sub-paragraph shall not apply; but
 
      (ii) any assessment which (applying that modification) could have been made immediately after the death may be made at any time within three years after it.
      (5) Nothing in this paragraph shall prejudice the powers of the Commissioners under paragraph 78(4).
 
 
Ordinary interest on overdue levy paid before assessment
     81. - (1) Where-
 
 
    (a) the circumstances are such that an assessment could have been made under paragraph 78 or 79 of an amount of levy due from any person, but
 
    (b) before such an assessment was made and notified to that person that amount was paid (so that no such assessment was necessary),
       the whole of the amount paid shall carry interest for the period specified in sub-paragraph (2).
 
      (2) That period is the period which-
 
 
    (a) begins with the day after that on which the person is required in accordance with regulations under paragraph 41 to pay levy due from him for the accounting period to which the amount paid relates; and
 
    (b) ends with the day before that on which the amount is paid.
      (3) Interest under this paragraph shall be payable at the rate applicable under section 197 of the Finance Act 1996.
 
 
Penalty interest on unpaid levy
     82. - (1) Where-
 
 
    (a) a person makes a return for the purposes of any regulations made under paragraph 41 (whether or not at the time required by the regulations), and
 
    (b) the return shows that an amount of levy is due from him for the accounting period for which the return is made,
       that amount shall carry penalty interest for the period specified in sub-paragraph (2).
 
      (2) That period is the period which-
 
 
    (a) begins with the day after that on which the person is required in accordance with regulations under paragraph 41 to pay levy due from him for the accounting period in question; and
 
    (b) ends with the day before that on which the amount shown in the return is paid.
 
Penalty interest on levy where no return made
     83. - (1) Where-
 
 
    (a) the Commissioners make an assessment under paragraph 78 or 79 of an amount of levy due from any person for any accounting period and notify it to him, and
 
    (b) the assessment is made at a time after the time by which a return is required by regulations under paragraph 41 to be made by that person for that accounting period and before any such return has been made,
       that amount shall carry penalty interest for the period specified in sub-paragraph (2).
 
      (2) That period is the period which-
 
 
    (a) begins with the day after that on which the person is required in accordance with regulations under paragraph 41 to pay levy due from him for the accounting period in question; and
 
    (b) ends with the day before that on which the assessed amount is paid.
      (3) Where the person, after the assessment is made, makes for the purposes of any regulations under paragraph 41 a return for the accounting period in question, the assessed amount shall not carry penalty interest under this paragraph to the extent that that amount is shown in the return as an amount of levy due from him for that accounting period (and, accordingly, carries penalty interest under paragraph 82).
 
 
Ordinary and penalty interest on under-declared levy
     84. - (1) Subject to sub-paragraph (4), where-
 
 
    (a) the Commissioners make an assessment under paragraph 78 or 79 of an amount of levy due from any person for any accounting period and notify it to him,
 
    (b) the assessment is made after a return for the purposes of any regulations under paragraph 41 has been made by that person for that accounting period, and
 
    (c) the assessment is made on the basis that the amount ("the additional amount") is due from him in addition to any amount shown in the return, or in a previous assessment made in relation to the accounting period,
       the additional amount shall carry interest for the period specified in sub-paragraph (2).
 
      (2) That period is the period which-
 
 
    (a) begins with the day after that on which the person is required in accordance with regulations under paragraph 41 to pay levy due from him for the accounting period in question; and
 
    (b) ends with the day before the day on which the additional amount is paid.
      (3) Interest under this paragraph-
 
 
    (a) in respect of so much of the period specified in sub-paragraph (2) as falls before the day on which the assessment is notified to the person in question, shall be payable at the rate applicable under section 197 of the Finance Act 1996 for the purposes of paragraph 81(3); and
 
    (b) in respect of the remainder (if any) of that period, shall be penalty interest.
      (4) Where-
 
 
    (a) the Commissioners make an assessment under paragraph 78 or 79 of an amount of levy due from any person for any accounting period and notify it to him,
 
    (b) they also specify a date for the purposes of this sub-paragraph, and
 
    (c) the amount assessed is paid on or before that date,
       the only interest carried by that amount under this paragraph shall be interest, at the rate given by sub-paragraph (3)(a), for the period before the day on which the assessment is notified.
 
 
Penalty interest on unpaid ordinary interest
     85. - (1) Subject to sub-paragraph (2), where the Commissioners make an assessment under paragraph 88 of an amount of interest payable at the rate given by paragraph 81(3), that amount shall carry penalty interest for the period which-
 
 
    (a) begins with the day on which the assessment is notified to the person on whom the assessment is made; and
 
    (b) ends with the day before the day on which the assessed interest is paid.
      (2) Where-
 
 
    (a) the Commissioners make an assessment under paragraph 88 of an amount of interest due from any person,
 
    (b) they also specify a date for the purposes of this sub-paragraph, and
 
    (c) the amount of interest assessed is paid on or before that date,
       the amount paid before that date shall not carry penalty interest under this paragraph.
 
 
Penalty interest
     86. - (1) Penalty interest under any of paragraphs 82 to 85 shall be compound interest calculated-
 
 
    (a) at the penalty rate, and
 
    (b) with monthly rests.
      (2) For this purpose the penalty rate is the rate found by-
 
 
    (a) taking the rate applicable under section 197 of the Finance Act 1996 for the purposes of paragraph 81(3); and
 
    (b) adding 10 percentage points to that rate.
      (3) Where a person is liable under any of paragraphs 82 to 85 to pay any penalty interest, the Commissioners or, on appeal, an appeal tribunal may reduce the amount payable to such amount (including nil) as they think proper.
 
      (4) Subject to sub-paragraph (5), where the person concerned satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the conduct giving rise to the liability to pay penalty interest, that is a matter which (among other things) may be taken into account under sub-paragraph (3).
 
      (5) In determining whether there is a reasonable excuse for the purposes of sub-paragraph (4), no account shall be taken of any of the following matters, that is to say-
 
 
    (a) the insufficiency of the funds available to any person for paying any levy due or for paying the amount of the interest;
 
    (b) the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of levy;
 
    (c) the fact that the person liable to pay the interest or a person acting on his behalf has acted in good faith.
      (6) In the case of interest reduced by the Commissioners under sub-paragraph (3) an appeal tribunal, on an appeal relating to the interest, may cancel the whole or any part of the reduction made by the Commissioners.
 
 
Supplemental provisions about interest
     87. - (1) Interest under any of paragraphs 81 to 85 shall be paid without any deduction of income tax.
 
      (2) Sub-paragraph (3) applies where-
 
 
    (a) an amount carries interest under any of paragraphs 81 to 85 (or would do so apart from that sub-paragraph); and
 
    (b) all or part of the amount turns out not to be due.
      (3) In such a case-
 
 
    (a) the amount or part that turns out not to be due shall not carry interest under the applicable paragraph and shall be treated as never having done so; and
 
    (b) all such adjustments as are reasonable shall be made, including (subject to paragraphs 64 to 76) adjustments by way of repayment.
 
Assessments to interest
     88. - (1) Where a person is liable for interest under any of paragraphs 81 to 85, the Commissioners may assess the amount due by way of interest and notify it to him accordingly.
 
      (2) If, where an assessment has been notified to any person under sub-paragraph (1) or this sub-paragraph, it appears to the Commissioners that the amount which ought to have been assessed exceeds the amount that has already been assessed, the Commissioners may make a supplementary assessment of the amount of the excess and shall notify that person accordingly.
 
      (3) Where an amount has been assessed and notified to any person under this paragraph, it shall be recoverable as if it were levy due from him.
 
      (4) Sub-paragraph (3)-
 
 
    (a) shall not apply so as to require any interest to be payable on interest except-
 
      (i) in accordance with paragraph 85, or
 
      (ii) in so far as it falls to be compounded in accordance with paragraph 86;
 
    and
 
    (b) shall not have effect if, or to the extent that, the assessment in question has been withdrawn or reduced.
      (5) Paragraph 80 shall apply in relation to assessments under this paragraph as if any assessment to interest were an assessment under paragraph 78 to levy due for the period which is the relevant accounting period in relation to that interest.
 
      (6) Subject to sub-paragraph (7), where a person-
 
 
    (a) is assessed under this paragraph to an amount due by way of any interest, and
 
    (b) is also assessed under paragraph 78 or 79 for the accounting period which is the relevant accounting period in relation to that interest,
       the assessments may be combined and notified to him as one assessment.
 
      (7) A notice of a combined assessment under sub-paragraph (6) must separately identify the interest being assessed.
 
      (8) The relevant accounting period for the purposes of this paragraph is-
 
 
    (a) in the case of interest on levy due for any accounting period, that accounting period; and
 
    (b) in the case of interest on interest (whether under paragraph 85 or by virtue of any compounding under paragraph 86), the period which is the relevant accounting period for the interest on which the interest is payable.
      (9) In a case where-
 
 
    (a) the amount of any interest falls to be calculated by reference to levy which was not paid at the time when it should have been, and
 
    (b) that levy cannot be readily attributed to any one or more accounting periods,
       that levy shall be treated for the purposes of interest on any of that levy as levy due for such period or periods as the Commissioners may determine to the best of their judgement and notify to the person liable.
 
 
Further assessments to penalty interest
     89. - (1) Where an assessment is made under paragraph 88 to an amount of penalty interest under any of paragraphs 82 to 85-
 
 
    (a) the notice of assessment shall specify a date, not later than the date of the notice of assessment, to which the amount of interest which is assessed is calculated; and
 
    (b) if the interest continues to accrue after that date, a further assessment or further assessments may be made under paragraph 88 in respect of the amounts so accruing.
      (2) Where-
 
 
    (a) an assessment to penalty interest is made specifying a date for the purposes of sub-paragraph (1)(a), and
 
    (b) within such period as may for the purposes of this sub-paragraph have been notified by the Commissioners to the person liable for the interest, the amount on which the interest is payable is paid,
       that amount shall be deemed for the purposes of any further liability to interest to have been paid on the specified date.
 
 
Walking possession agreements
     90. - (1) This paragraph applies where-
 
 
    (a) in accordance with regulations under section 51 of the Finance Act 1997 (enforcement by distress), a distress is authorised to be levied on the goods and chattels of a person ("the person in default") who has refused or neglected to pay an amount of levy due from him or an amount recoverable from him as if it were levy; and
 
    (b) the person levying the distress and the person in default have entered into a walking possession agreement.
      (2) For the purposes of this paragraph a walking possession agreement is an agreement under which, in consideration of the property distrained upon being allowed to remain in the custody of the person in default and of the delaying of its sale, the person in default-
 
 
    (a) acknowledges that the property specified in the agreement is under distraint and held in walking possession; and
 
    (b) undertakes that, except with the consent of the Commissioners and subject to such conditions as they may impose, he will not remove or allow the removal of any of the specified property from the premises named in the agreement.
      (3) Subject to sub-paragraph (4), if the person in default is in breach of the undertaking contained in a walking possession agreement, he shall be liable to a penalty equal to one half of the levy or other amount referred to in sub-paragraph (1)(a).
 
      (4) The person in default shall not be liable to a penalty under sub-paragraph (3) if he satisfies the Commissioners or, on appeal, an appeal tribunal that there is a reasonable excuse for the breach in question.
 
      (5) This paragraph does not extend to Scotland.
 
 
Interpretation etc. of Part VII
     91. - (1) In this Part of this Schedule "penalty interest" shall be construed in accordance with paragraph 86.
 
      (2) Any notification of an assessment under any provision of this Part of this Schedule to a person's representative shall be treated for the purposes of this Schedule as notification to the person in relation to whom the representative acts.
 
      (3) In this Part of this Schedule "representative", in relation to any person, means-
 
 
    (a) any of that person's personal representatives;
 
    (b) that person's trustee in bankruptcy or liquidator;
 
    (c) any person holding office as a receiver in relation to that person or any of his property;
 
    (d) that person's tax representative or any other person for the time being acting in a representative capacity in relation to that person.
      (4) In this paragraph "trustee in bankruptcy" includes, as respects Scotland-
 
 
    (a) an interim or permanent trustee (within the meaning of the Bankruptcy (Scotland) Act 1985); and
 
    (b) a trustee acting under a trust deed (within the meaning of that Act).
 
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