SolvedIFM09660 | Ceasing to be a RIF: Cessation notice given to RIF operator - Regulation 24
From HM Revenue & Customs · Investment Funds Manual
Regulation 24 requires a cessation notice to be issued by an officer of HMRC to an operator of a RIF where any of the following apply:
the designated officer of HMRC determines that it is reasonable to do so in order to safeguard the public revenue
it is determined that a RIF has breached one or more qualifying conditions, and the operator of the RIF has not given a notice required under Regulation 9(3), 13(3), 16(2), 18(3) or 21
A notice in respect of information required in respect of each accounting period under Regulation 37 will be given where the operator fails to provide either:
the information within 6 months of the Information Reporting Date (‘IRD’), that is, the date 6 months after the end of the accounting period without reasonable excuse
the required information by the IRD without reasonable excuse, but does so within 6 months of that date and has been similarly late previously
These rules are intended to encourage timely submission of information, which is important for HMRC operational and compliance purposes. The provision of a ‘reasonable excuse’ defence, and an appeals process when a cessation notice is issued, provide protections for customers.
If the RIF operator is relying on the UK property rich restriction condition, which it monitors and provides information on for an accounting period in accordance with Regulation 37, it is not expected to provide information about an additional restriction condition being met where it does not know, and is not required to know, that the additional condition is met.
For example, a RIF relying on the exempt investor condition, not being aware and not reporting that the second restriction condition also applies for an accounting period, will not be regarded as a failure should they subsequently discover that condition had also been met.