Written Determinations and the Right to Appeal

An employer is required by Regulation 19 of the Income Tax (Modified ITIP) Regulations 1987 and paragraph 10 of schedule 4 of the Social Security (Contributions) Regulations 2001 (as applied to the Isle of Man), to pay Income Tax Instalment Payment (ITIP) deductions and earnings-related (Class 1 National Insurance) contributions by the due date.

Failure to make these payments by the due date is an offence under section 1(2B) of the Income Tax (Instalment Payments) Act 1974 and section 114(1) of the Social Security Administration Act 1992, as applied to the Isle of Man (“the Act”).

Regulation 32A[1] of the Income Tax (Modified ITIP) Regulations 1987 states that if a prosecution of a body corporate is successfully brought, each of the directors can be held jointly and severally liable and personally pursued for the unpaid ITIP deductions and National Insurance Contributions.

A person appointed by the Assessor of Income Tax, referred to as an ‘Authorised Officer’, can make a formal determination that you, as a director, knew or could reasonably be expected to have known of a failure to pay the ITIP deductions and National Insurance Contributions in respect of a company of which you are/were a director. This is known as a Written Determination.

If you think the decision is wrong you should appeal against it at once. Let us have any further information you have. We may be able to vary the decision. If you appeal you do not have to pay the amount due until your appeal is settled.

The appeals procedure is laid down by law and provides a method for disagreements between you and the Assessor to be settled. Most appeals concern disagreements over interpretations of the law or over facts, information or figures you have provided.

Usually agreement is reached by correspondence or discussion and in most cases we will be able to settle the matter with you personally. However, if we disagree with you on a point of law, or if we cannot accept the facts, figures or information you have provided, you can take your appeal to the Income Tax Commissioners (an independent tribunal).

A guide to Written Determinations and the Right to Appeal (GN 56) is available on the Guidance Note page. If you decide that you want to appeal a determination made by us, please use form R246 ‘Written Determinations – Appeal form’ that can be found on the Employer’s Forms page.

Footnotes

[1] Regulation 32A was inserted into the Income Tax (Modified I.T.I.P.) Regulations 1987 by the Income Tax Legislation (Amendment) Act 2017