Regulation 28 I1

This regulation applies by way of an exception to regulation 27 but only in relation to errors.

Where a registrable person discovers that a return he has previously made is based on an under-calculation he must correct the error by adding an appropriate amount to the CCL due for the accounting period in which the discovery is made under regulation 5(1)(b) (CCL due).

Where a registrable person discovers that a return he has previously made is based on an over-calculation he must correct the error by deducting an appropriate amount from the CCL due for the accounting period in which the discovery is made under regulation 5(1)(b) (CCL due).

For the purposes of paragraphs (2) and (3)—

• “under-calculation” refers to the aggregate, which must not exceed F1£50,000, of—

  1. (a)

     the CCL due on taxable supplies—

     1. (i)

        the times of supply of which were in the accounting period to which the previous return related, and

     2. (ii)

        for which the registrable person in question was liable to account;

  2. (b)

     but which was not properly taken into consideration for that period (see regulation 5(1)) (“understated CCL”);

• “over-calculation” refers to the aggregate, which must not exceed £50,000, of—

  1. (a)

     amounts that were wrongly taken as CCL due on taxable supplies—

     1. (i)

        the times of supply of which were in the accounting period to which the previous return related, and

     2. (ii)

        for which the registrable person in question was liable to account;

  2. (b)

     and which were wrongly taken into consideration for that period (see regulation 5(1)) (“overstated CCL”).

But if the registrable person’s VAT turnover is small, each aggregate in paragraph (4) must not for those purposes exceed 1% of that turnover unless the aggregate is F3£10,000 or less.

And if that person is not registered for VAT, each aggregate must not for those purposes exceed £10,000.

F4The VAT turnover is small only if Box 6 of that person’s value added tax return for the prescribed accounting period in which the discovery is made must contain a total less than £5,000,000 (total value of sales and all other outputs excluding any value added tax).

(See sections 96(1) and 1 of the Value Added Tax Act 1994 for “VAT” and “value added tax”, and sections 96(2) and 3 of and Schedules 1 to 3A to that Act about being registered for VAT; regulations 2(1) and 25 of and Schedule 1 Forms 4 and 5 to the Value Added Tax Regulations 1995 for the meaning carried by “Box 6” and “return”; sections 96(1) and 25(1) of that Act and regulations 2(1), 25 and 99(1) of those Regulations for the meaning carried by “prescribed accounting period”; section 24(2) of that Act for “output tax”.)

For the purposes of F5paragraphs (4) and (4A)—

A registrable person making a correction under paragraph (2) or (3) shall make proper allowance for that correction for the purposes of complying with regulation 7(1) (CCL account) or 7(3) (tax credits account), as appropriate.

Where an error in a return has to any extent been corrected under this regulation—

A person shall not correct an error in a return (where that error is the result of an under-calculation or over-calculation) except in accordance with this regulation.

This regulation has effect subject to, as the case requires—