Value Added Tax Act 1994 section 68

Breaches of walking possession agreements

Section 68 deals with the penalties that apply when a person who owes unpaid VAT breaches a walking possession agreement made as part of the distress (seizure of goods) enforcement process in Northern Ireland.

• Where a person fails to pay VAT due, HMRC may authorise the seizure (distress) of their goods and chattels, and a walking possession agreement may be entered into allowing the seized goods to remain on the defaulter's premises
• Under a walking possession agreement, the person in default acknowledges the goods are under distraint and undertakes not to remove them from the named premises without HMRC's consent
• If the person in default breaches the walking possession agreement, they face a penalty equal to half of the VAT or other amount owed
• No penalty applies if the person can demonstrate to HMRC, or on appeal to a tribunal, that there was a reasonable excuse for the breach