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The Government is committed to doing what is necessary to protect the Exchequer, maintain fairness in the tax system and give certainty to taxpayers. Therefore, the Government is announcing today that legislation will be brought forward in the next Finance Bill to put the meaning of the law in relation to automation of tax notices beyond doubt. Specifically, that legislation will put beyond doubt that HMRC’s use of large-scale automated processes to give certain statutory notices, and to carry out certain functions is, and always has been, fully authorised by tax administration law. This measure will have effect both prospectively and retrospectively.
The Government introduces legislation with retrospective effect only where necessary. In this case retrospective effect is necessary to close off the exchequer and operational risks presented by judicial challenges to HMRC’s ability to automate certain functions. It will protect very substantial sums of tax and penalties already legitimately paid. It will preserve the status quo for taxpayers and HMRC, merely confirming the validity of HMRC’s longstanding and widely accepted operational practice. Taking this action will help to guarantee the integrity of the tax base, provide certainty to taxpayers, and allow the Government to continue to administer the tax system efficiently. More details will be published on the Finance Bill 2019-20 pages of GOV.UK.