BKLM442100 - Collection and management: responsible members for groups: the nomination process

Paragraph 55 of Schedule 19

An entity that is nominated can only become the responsible member if it meets all of the conditions in paragraph 54. The final one of these conditions is that HMRC accepts the nomination made.

The rules determining the circumstances in which HMRC may reject a nomination and the rules relating to the nomination process more generally are described below.

An entity can nominate itself to be the responsible member but only one nomination can be made on behalf of the group during a chargeable period. A nomination by an entity must be made in writing to the relevant group's Customer Compliance Manager (CCM).

HMRC must decide whether to accept or reject the nomination and then notify the entity which has made the nomination of its decision within 30 days of receipt of the nomination.

Paragraph 55(4) provides that HMRC may publish requirements as to the information to be provided in a nomination. The information required is as follows:

  • the full registered name, address and company number of the parent entity and the same details for the nominated entity if the nominee is not the parent entity
  • the nominated entity's Unique Taxpayer Reference (UTR) number
  • the chargeable period to which the nomination relates
  • confirmation that the nominee is expected to have an accounting period that matches the chargeable period
  • confirmation that the nominee is expected to be a chargeable member of the relevant group
  • confirmation that the nominee has sufficient resources to pay the bank levy, and
  • the signature of the Senior Accounting Officer (SAO) for the relevant group or a director or company secretary of the nominee on behalf of the SAO.

HMRC may only reject nominations in one or more of the following circumstances:

  • where more than one nomination has been made in the chargeable period
  • where the nomination is lacking information which HMRC has published as being required with the nomination (see above)
  • HMRC has reason to believe that the nominee will not be a chargeable member (that is a member of the relevant group, or within the charge to Corporation Tax) at the end of the chargeable period
  • it is believed that the nominee will not have an accounting period for Corporation Tax purposes that starts and ends on the same days as the chargeable period, or
  • where HMRC is not satisfied that the nominee has, or will have, sufficient resources itself to pay the bank levy liability.

There were special transitional rules for dealing with nominations for chargeable periods starting on or before Finance Bill 2011 received Royal Assent - see BKLM442200.

Paragraph 55A of Schedule 19

From 15 March 2018, the annual nomination requirement was amended to permit automatic renewal of an entity’s responsible member status.

HMRC may determine that the entity that would be the responsible member under the automatic renewal provision is not the group’s responsible member for the chargeable period. Such a determination must be made within 30 days from the end of the nomination period, which is the first 45 days of the chargeable period.

HMRC may only make such a determination if:

  • the information HMRC requires responsible members to provide is not provided, or
  • HMRC has reason to believe that the entity:
    • has ceased to be a chargeable member of the group
    • no longer has an accounting period for corporation tax purposes which is the same as the chargeable period, or

will turn out not to have sufficient resources to pay the bank levy.