What does section 83FB of the Value Added Tax Act 1994 do?

Section 83FB explains how HMRC review conclusions take effect for penalties under Schedule 24 to the Finance Act 2021. It modifies paragraph 24 of Schedule 24 so that references to tribunal appeals are read as references to HMRC's internal review process, allowing review outcomes to carry the same legal consequences as tribunal decisions.

How are references to the tribunal modified under section 83FB?

Section 83FB makes three key modifications: references to an appeal under paragraph 22(b) of Schedule 24 become references to an HMRC review under section 83C or 83E; references to the tribunal become references to HMRC itself; and references to cancelling a decision become HMRC concluding its own decision should be cancelled.

When do HMRC review conclusions become final under section 83FB?

Review conclusions become final only once the statutory time limit for appealing the reviewed decision to the tribunal under section 83G has expired and no appeal has been lodged. Until that appeal window closes, the conclusions remain provisional and paragraph 24 of Schedule 24 does not take effect.

What practical effect does section 83FB have on a reduced penalty following HMRC review?

If HMRC reviews a Schedule 24 penalty and concludes it should be reduced, and the taxpayer does not appeal within the section 83G time limit, the review conclusions become final. Paragraph 24(4) and (5) of Schedule 24 then apply with modifications, giving effect to the reduced penalty as the settled amount due.

Value Added Tax Act 1994 section 83FB

Effect of conclusions of review: penalties under Schedule 24 to FA 2021

Section 83FB explains what happens when HMRC completes a review of a penalty decision made under Schedule 24 to the Finance Act 2021, and how the conclusions of that review take effect once the appeal window has closed without an appeal being made.

When a review of a Schedule 24 penalty decision is completed and becomes final, the rules in paragraph 24 of Schedule 24 to the Finance Act 2021 apply, but adapted so that references to a tribunal appeal are read as references to the HMRC review process instead.
References in paragraph 24 to an appeal under paragraph 22(b) of that Schedule are to be read as referring to the HMRC review carried out under section 83C or section 83E of the VAT Act 1994.
References in paragraph 24 to the tribunal are to be read as references to HMRC, and references to cancelling a decision are to be read as HMRC concluding that its own decision should be cancelled.
The conclusions of a review are treated as final only once the time limit for appealing the reviewed decision under section 83G has expired and no appeal has been made within that period.

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