When a customer doesn’t agree with a decision which has been made by HMRC, they can appeal against it. There are two types of taxes, direct and indirect, and the process of having the decision reviewed varies slightly for each.
Initial request for an appeal
For direct taxes – which are taxes taken directly from an individual, including income tax – a customer will usually submit an appeal to HMRC to say they don’t agree with a decision. At this time, an application may also be made to postpone payment of some or all the tax outstanding. The decision maker will discuss the matter with the customer and try to reach an agreement. If this isn’t possible, the individual may request a formal review from an independent reviewer, or could submit an appeal to the tribunal.
Types of appeal
The initial appeal against a decision is dealt with by HMRC, which will try to negotiate an agreement. If this doesn’t result in a settlement, the customer may then appeal to the tribunal, which is a formal process. If a formal review has been requested, the appeal cannot be submitted to the tribunal until the review has been completed.
The formal review process
If negotiations with a customer don’t result in a satisfactory agreement, the individual will be offered a formal review of the decision. The letter which offers the review must be sent to the customer, although if authorisation is held, a copy must be sent to the agent. Once the review has been offered, the customer must respond within 30 days of the date on the letter if they want to accept the offer. If no response is received from the customer and an appeal is not submitted to tribunal, the decision will be treated as though it has been agreed and settled.
Requesting a review before it is offered by HMRC
If a customer requests a review of the decision but hasn’t been offered a formal review in writing, the decision maker must send out the ‘view of the matter’ to the customer. In either situation, HMRC must complete the formal review within 45 days of the request being received.
Once the review has been completed, the officer involved must send out a conclusion letter which outlines the final decision and the reasoning behind it. It is possible to ask for an extension of the review period, as long as both parties agree to it.
The review process is complex and timelines must be adhered to, which is why it is advisable to seek professional advice if necessary.
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