SCHEDULES
F1SCHEDULE 7AInterest restriction returns
PART 4Enquiry into interest restriction return
Extended time limits for opening enquiries: discovery of errors
42
1
Notice of enquiry may be given later than the time allowed under paragraph 41, or a closed enquiry may be re-opened, if—
a
an officer of Revenue and Customs discovers that an interest restriction return submitted to an officer of Revenue and Customs does not, or might not, comply with the requirements of paragraph 20(3) in any respect,
b
there would be, or might be, an increase in tax payable by any company for any accounting period if the return had complied with those requirements in that respect,
c
the discovery is made after the time allowed under paragraph 41 or after an enquiry into the return has been closed, and
d
the officer could not, at the relevant time and by reference to the relevant information, have been reasonably expected to be aware of the respects in which the return might not comply with those requirements.
2
For this purpose “the relevant time” means—
a
in a case where no notice of enquiry has been given within the time allowed under paragraph 41, when an officer of Revenue and Customs ceased to be entitled to give a notice, or
b
in a case where an enquiry has been closed, when the officer gave the closure notice.
3
For this purpose “the relevant information” means information which—
a
is contained in the interest restriction return in question or either of the two returns for the immediately preceding periods of account of the group,
b
is contained in any documents, financial statements or other accounts or information produced or provided to an officer of Revenue or Customs for the purposes of an enquiry into the interest restriction return in question or either of the two returns for the immediately preceding periods of account of the group,
c
is information the existence of which, and the relevance of which as regards the situation mentioned in sub-paragraph (1)(b), could reasonably be expected to be inferred by an officer of Revenue and Customs from information falling with paragraph (a) or (b) of this sub-paragraph, or
d
is information the existence of which, and the relevance of which as regards the situation mentioned in sub-paragraph (1)(b), are notified in writing to an officer of Revenue and Customs by the reporting company for the period of account or a person acting on its behalf.
4
Notice of enquiry into an interest restriction return for a period of account may not be given, or a closed enquiry may not be re-opened, as a result of this paragraph more than the applicable number of years after the end of the period of account.
5
The “applicable number of years” is—
a
20 years in a case involving deliberate non-compliance by the reporting company for the period of account or by a qualifying person,
b
6 years in a case involving careless non-compliance by the reporting company for the period of account or by a qualifying person, and
c
4 years in any other case.
6
For this purpose “qualifying person” means—
a
a person acting on behalf of the reporting company for the period of account, or
b
a person who was a partner of the reporting company for the period of account at the relevant time.
7
For the purposes of this paragraph an enquiry is “closed” when a closure notice is given in relation to the enquiry.
Sch. 7A inserted (with effect in accordance with Sch. 5 para. 25(1)(2) of the amending Act) by Finance (No. 2) Act 2017 (c. 32), Sch. 5 para. 2 (with Sch. 5 para. 28)