Nominations of tax repayments remain valid

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Assignments of income tax repayments are void from Budget Day. However, HMRC will continue to accept nominations of repayments to third parties, including agents.

In its response to Raising standards in tax advice: protecting customers claiming tax repayments, the government announced that assignments of income tax repayments will be rendered void.

This decision was confirmed at Spring Budget 2023. Draft legislation is included in the Finance Bill. The measure applies to assignments of income tax repayments received by HMRC on or after 15 March 2023, whenever signed.

Assignments are governed by the Law of Property Act 1925. They formally transfer certain debts to another party and can only be revoked with the agreement of both parties. They have been used (and sometimes abused) by high volume repayment agents.

The more familiar nominations of specific tax repayments, for example on a self assessment tax return or a P87 claim for employment expenses, are unaffected by this change. HMRC will continue to accept nominations.

HMRC will, for now, treat assignments received on or after 15 March 2023 as non-legally binding nominations.

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