Currently, when an enquiry is concluded, HMRC issue a closure notice detailing the change, if any, to the tax due as a result of the enquiry.
If the Finance Bill 2017 is enacted without alteration then the current closure notices will cease to exist and will be replaced by Partial Closure Notices (PCNs) and Final Closure Notices (FCNs).
A PCN can be issued to close any matter in an enquiry without closing the whole enquiry. This will bring the tax liability associated with the matter into charge. The effect of this will be that the tax becomes due 30 days after the issue of the PCN (or FCN), after which interest will be chargeable. A penalty for error can be decided after the issue of the PCN.
Contract settlements will remain unaffected.
Katharine Arthur, Head of Tax, haysmacintyre
T: 020 7969 5610 E firstname.lastname@example.org