OT61040 | Transferable tax history - Administration and enquiries - Election - withdrawal

An election may only be withdrawn in respect of the purchaser, if an officer of HMRC gives notice to the purchaser that the election is being withdrawn. HMRC may only give a withdrawal notice if the purchaser consistently and without reasonable excuse fails to comply with the profit tracking requirement or the record keeping requirement under FA19\Sch15\Para63.

Withdrawal does not affect any amounts of activated TTH against which losses have previously been set. These may be challenged under the normal enquiry rules if appropriate.

However, if an election is withdrawn, the election ceases to have effect in respect of the purchaser, so no more TTH can be activated, and no further losses can be set against previously activated TTH.

Withdrawal is not automatic. If there is a persistent failure, HMRC will firstly discuss with the company to understand the reasons for the failure before deciding whether to withdraw the election.

A withdrawal notice may be appealed to the Tribunal, which has the power to confirm or cancel the decision. If the decision is cancelled, and the election is re-instated by the Tribunal the election is treated as having had continuing effect throughout the period where the election had been withdrawn. Therefore, if a company appeals a withdrawal decision, it should continue to track profits and decommissioning expenditure during the period of the appeal, so that it is able to accurately quantify the amount of any TTH activated should the appeal be decided in its favour.