Citation, commencement and interpretation

1. —(1) These Regulations may be cited as the Controlled Foreign Companies (Reversal of State Aid Recovery) Regulations 2024 and come into force on 31st December 2024.

(2) In these Regulations, “ relevant adjustment ” means—

(a) any adjustment or amendment to any company tax return, self-assessment, or statement,

(b) any adjustment or amendment to, or making, giving or withdrawal of, any claim, election, application or notice, and

(c) in the case of a relevant adjustment under regulation 2(2)(b), any adjustment or amendment to any discovery assessment or discovery determination.

Reversal of state aid recovery

2. —(1) An officer of HMRC must—

(a) give a notice (a “reversal notice”) to any company affected by Schedule 7ZA (“ Schedule 7ZA ”) of the Taxation (International and Other Provisions) Act 2010, and

(b) cancel any interest charging notice given to the company.

(2) A reversal notice must—

(a) cancel any charging notice and consequential amendment notice given to the company, and

(b) make any relevant adjustment, in relation to the company, relating to any accounting period, which the officer considers appropriate for the purposes of securing, so far as reasonably practicable, that the company is put into the position it would have been in if—

(i) the Commission Decision had not been made, and

(ii) Schedule 7ZA had not had effect.

(3) A reversal notice must be given and any interest charging notice cancelled as soon as reasonably practicable after these Regulations come into force.

Consequential adjustments

3. —(1) A company affected by a reversal notice may make a relevant adjustment in relation to an amount—

(a) arising in consequence of a relevant adjustment made in a reversal notice, and

(b) relating to any accounting period ending on or after 1st January 2019.

(2) A relevant adjustment under this regulation must be made within a period of 12 months beginning immediately after the end of the accounting period of the company in which the reversal notice is given (whether given to that company or another company).

(3) If a relevant adjustment relates to a claim, election, application or notice previously made or given, the claim, election, application or notice must be revoked or varied—

(a) in the same manner as it was made or given, and

(b) by or with the consent of the same person or persons who made, gave or consented to it.

(4) If the effect of a relevant adjustment under this regulation would be to alter the liability to tax of another person, the adjustment may not be made except with the consent in writing of that other person.

(5) Where a relevant adjustment under this regulation is made so as to increase the liability to tax of another person, paragraph 61 of Schedule 18 to FA 1998( 2 ) does not apply in relation to any amendment or assessment made because of that increased liability.

Consequences of relevant adjustment

4. Where a relevant adjustment is made under these Regulations, all such adjustments must be made, whether by way of discharge or repayment of tax or the making of amendments, assessments or otherwise, as are required to take account of the effect of the taking of that action on any person’s liability to tax for any chargeable period.

Appeals

5. —(1) An appeal against a charging notice or a consequential amendment notice is treated as withdrawn when a reversal notice is given to the appellant company.

(2) A company may appeal against a reversal notice or a decision by HMRC on a relevant adjustment under regulation 3.

(3) Notice of an appeal must be given to HMRC, in writing, within a period of 30 days beginning with the day on which the notice is given or the decision is notified.

(4) The notice of appeal must specify the grounds of appeal.

(5) On appeal of a reversal notice under this regulation, the Tribunal may—

(a) confirm the reversal notice to which the appeal relates, or

(b) amend the reversal notice.

(6) References in Part 5 of TMA 1970( 3 ) (appeals etc) to an assessment are to be read as including a reversal notice.