SACM9010 | Consequential Claims after Assessment and Amendment: Culpable Additions

Throughout this manual legislative references are to the Taxes Management Act 1970 (TMA70), unless otherwise stated.

Where we make a discovery assessment or amend a return in an SA enquiry closure notice because of careless or deliberate behaviour, the taxpayer can make an out-of-time claim or application for a relief or allowance for the relevant year (the year relating to the discovery assessment or amendment).

The claim is limited to the extent that it can be given effect

• in the discovery assessment, or

• against the additional liability charged by our amendment, see S36(3) and S43C(1).

In such cases we accept that making a claim also includes increasing the amount of a previous claim.

Not all claims fall within the wording of S36(3). For example it does not apply to

• a claim that an asset has become of negligible value, see TCGA92/S24(2)

• a claim that a loan to a trader has become irrecoverable, see TCGA92/S253.

S36(3) does not permit a taxpayer to make an election out-of-time.

A report should be made to the appropriate Technical Team where, in the case of a late election, the Board is empowered to allow further time or a submission is mandatory. For example, certain late capital gains tax elections must be submitted under the guidance at CG13700P.