Taxes Management Act 1970 section 8

Effect of a plan [Schedule 3ZAA paragraph 8]

Section 8 of Schedule 3ZAA sets out what happens once a taxpayer has entered into a CGT exit charge payment plan, including how HMRC must collect the tax, how interest applies, when penalties arise, and what events can trigger immediate payment of the outstanding balance.

• Once a plan is in place, HMRC can only collect the deferred exit charge in accordance with the plan's terms, and may refund amounts already paid before the plan was agreed
• Interest continues to accrue on the deferred exit charge as though no plan existed, and each instalment must be paid together with any interest due on it
• Late payment penalties only apply if the taxpayer fails to make payments in line with the plan, and the taxpayer may voluntarily pay off any outstanding amount early along with interest to the date of payment
• The entire outstanding balance becomes payable on the next instalment date if the taxpayer becomes bankrupt, undergoes an equivalent insolvency event in another EEA state, or moves to a country outside the EEA