Taxation (International and Other Provisions) Act 2010 section 210

The requirement for the Commissioners' sanction

Section 210 sets out the procedural safeguards that apply when HMRC makes a transfer pricing determination that requires the formal approval (sanction) of the Commissioners for HMRC, and explains what happens if that approval is not properly obtained or communicated to the taxpayer.

• Where a transfer pricing determination requires the Commissioners' sanction, the relevant tax notice or assessment is ineffective to the extent it relies on that determination unless the Commissioners have formally approved it.
• Even if the Commissioners have approved the determination, their approval must be served on the taxpayer at or before the time the notice or assessment is issued; otherwise the notice or assessment takes effect as though the determination had never been made.
• The Commissioners' approval must be given specifically for the particular case and must cover the specific amount determined, but the form and manner of that approval is flexible and may be given before or after the determination is made.
• The effect of non-compliance is that the notice or assessment is treated as if it had been issued without the transfer pricing adjustment — in other words, the transfer pricing uplift falls away.