IFM41280 - Administrative requirements: breaches of eligibility criteria (except the activity and ownership condition)

FA22/SCH2/PARA 26 and 29(1) to (2)

The general rule is that a QAHC ceases to be a QAHC when any of the eligibility criteria (at PARA 2) cease to be met. Guidance on the eligibility criteria starts at IFM40200.

Example

A breach of one of the eligibility criteria occurred on 31 January but the company only discovered this on 15 February. The company ceases to be a QAHC on 31 January, the exit date.

A ‘breach and exit’ notification (PARA 26) should be submitted to HMRC as soon as reasonably practicable.

Exceptions

There are different rules for breaches of the ownership condition and the activity condition because sometimes these breaches may be cured (see IFM40430).

The consequences depend on whether or not the breach is deliberate. ‘Deliberate’ is defined at FA22/SCH2/PARA27(7)), see IFM40420.

Further guidance is available:

	Non-deliberate breach	Deliberate breach
Ownership condition	IFM41290+	IFM41330
Activity condition	IFM41340	IFM41350