ICAEW.com works better with JavaScript enabled.


Notification of uncertain tax treatments: amendment to notification dates


Published: 16 Dec 2021 Update History

The government has tabled amendments to Finance Bill 2021-22 to ensure notification of uncertain tax treatments by large businesses triggered by an accounting provision would not be required until after the provision has been made.

From April 2022, a new regime will require large businesses to notify HMRC of ‘uncertain’ tax treatments they have adopted in their corporation tax, partnership, PAYE or VAT returns. 

There are two triggers that would cause a position to be classed as uncertain and require notification. These are:

  • where a provision has been recognised in the accounts of the company or partnership to reflect the probability that a different tax treatment will be applied to a transaction to which the amount relates; or
  • if the tax treatment applied in arriving at the amount relies (wholly or in part) on an interpretation or application of the law that is not in accordance with the way in which it is known that HMRC would interpret or apply the law.

Deadlines for notifications are based on the financial year of the business concerned. Broadly speaking, this is the period for which the business draws up its accounts. This makes sense for corporation tax and partnership tax returns as these tend to be filed after the relevant accounts have been prepared. 

The Finance Bill as originally introduced requires a notification to be made on or before the date on which the last PAYE or VAT return for the financial year is required to be made. This deadline does not work for PAYE and VAT returns if the uncertainty arises as a result of an accounting provision, as that provision will likely be made after the relevant deadline.

The government amendments ensure that the deadline for notification of an uncertainty in a PAYE return is on or before the date that the last PAYE return is due to be made for the financial year following the one in which the accounting provision is recognised in the company or partnership accounts. The amended provision adopts an identical treatment in relation to VAT returns.

Further amendments are also being brought forward to ensure that, for partnerships, the provisions trigger operates where a provision has been made in the partnership accounts, rather than requiring notification where a provision has been made in the accounts of a partnership member.

Where the other trigger for notification applies (treatment relying on interpretation that differs from HMRC’s known interpretation), the notification deadlines remain as originally drafted (the date by which the company/partnership return concerned is to be filed or, for PAYE and VAT returns, the date by which the last return for the financial year is due to be filed).


XYZ Ltd has a 30 November financial year end. It pays its employees on the 25th of each month, filing its full payment summary (FPS) on the same day. It has included an amount in an FPS arising during the year ended 30 November 2022 that it considers to be uncertain.

  • If the notification requirement is triggered because the company has taken a different interpretation in the FPS to one that HMRC is known to take, that uncertainty must be notified by 25 November 2022 (even if the uncertainty arises in an earlier FPS than the one submitted for November 2022).
  • If the notification requirement is triggered as a result of the company making a provision in its accounts for the year to 30 November 2022 in relation to the amount concerned, the deadline for notification is 25 November 2023.

On 7 December 2021, ICAEW’s Tax Faculty issued a briefing to MPs suggesting a number of amendments to the uncertain tax treatment regime. This includes an extension to the filing deadline for notifications relating to PAYE and VAT returns, recognising the difficulties that businesses will face in making notifications, in some cases, by the same deadline that the relevant return needs to be filed.

While the amendment deals with the situation where an amount has become uncertain because a provision has been made in the business’s accounts, the potential for a notification to be required on the same day as a return remains where the uncertainty arises because the business has taken a position contrary to HMRC’s known position. 

ICAEW understands that HMRC still intends to introduce a reworked third trigger for making a notification through a future finance bill. This trigger was removed from the draft legislation published in July this year following feedback from various parties, including ICAEW, that it would be difficult to apply in practice.

Tax Faculty

This guidance is created by the Tax Faculty, recognised internationally as a leading authority and source of expertise on taxation. The Faculty is the voice of tax for ICAEW, responsible for all submissions to the tax authorities. Join the Faculty for expert guidance and support enabling you to provide the best advice on tax to your clients or business.

More support on tax

ICAEW's Tax Faculty provides technical guidance and practical support on tax practice and policy. You can sign up to the Tax Faculty's free enewsletter (TAXwire) which provides weekly updates on developments in tax.

Sign up for TAXwireJoin the Tax Faculty

More from the Tax Faculty

Latest news
Making tax digital image

Stay up to date with the latest developments in tax by signing up to the Tax Faculty's weekly e-newsletter

Practical guidance

Comprehensive support for Tax practitioners each month from the Tax Faculty and expert contributors.

Technical support
Tax Faculty image

Expert advice from the Tax Faculty's technical managers on all the developments in tax policy and practice.