What is an accelerated payment notice?
Answered 17 March 2026
Here is a comprehensive explanation of an accelerated payment notice (APN), drawing solely from the legislative sources retrieved.
What the law says
An accelerated payment notice (APN) is a notice that HMRC may give to a person ("P") requiring them to make an upfront payment of disputed tax while a tax enquiry or appeal is still ongoing. The regime is found in Part 4, Chapter 3 of the Finance Act 2014.
Conditions for issue (s.219)
HMRC may issue an APN only if three conditions (A, B and C) are all met:
- Condition A: Either (a) a tax enquiry is in progress into a return or claim made by P, or (b) P has made a tax appeal that has not yet been determined, abandoned or otherwise disposed of.
- Condition B: The return, claim or appeal is made on the basis that a particular tax advantage ("the asserted advantage") results from particular arrangements ("the chosen arrangements").
- Condition C: One or more of the following requirements are met:
- HMRC has given (or simultaneously gives) P a follower notice in relation to the same return/claim/appeal and the same tax advantage;
- The chosen arrangements are DOTAS arrangements (disclosed under the Disclosure of Tax Avoidance Schemes rules);
- A GAAR counteraction notice has been given in relation to the asserted advantage, where at least two members of the relevant GAAR Advisory Panel sub-panel opined that entering into the arrangements was not a reasonable course of action; or
- A notice of final decision has been given under Schedule 43A to FA 2013 in relation to the asserted advantage.
What the notice must contain (s.220)
Where the APN is given while a tax enquiry is in progress, the notice must:
- Specify the paragraph(s) of s.219(4) by virtue of which it is given;
- Specify the payment required and the requirements for making it;
- Explain the effect of the relevant representations and amendment provisions; and
- If applicable, specify any "asserted surrenderable amount" and required action.
The payment amount is determined by a designated HMRC officer to the best of their information and belief as the "understated tax" — i.e., the additional tax that would be due if the tax advantage were counteracted.
Effect and payment deadline (s.223)
Upon receipt of an APN, P must make a payment ("the accelerated payment") to HMRC of the specified amount. Key points:
- The accelerated payment is treated as a payment on account of the understated tax.
- It must be made within the "payment period", which is:
- 90 days from the date the APN is given (if no representations are made); or
- The later of that 90-day period or 30 days from notification of HMRC's determination on representations (if representations were made).
- If P pays any part of the understated tax before the accelerated payment, the accelerated payment is treated as having been paid to that extent at the same time.
Withdrawal and modification (s.227)
HMRC may at any time withdraw, partially withdraw, or reduce the amount specified in an APN. In particular:
- If the related follower notice is withdrawn, HMRC must withdraw the APN to the extent it was given by virtue of that follower notice.
- If the follower notice is suspended (e.g. pending a late appeal), the APN is also suspended for that period.
HMRC guidance / practice
HMRC guidance confirms that where a person has paid an amount under an APN in respect of charges under an avoidance scheme, it is possible in certain circumstances to alter the date on which related charges (such as the loan charge) arise, provided specific conditions are met. HMRC also notes that where an APN or Partner Payment Notice (PPN) has been issued, this must be considered when calculating any late payment penalties or surcharges in the context of contract settlements.
Summary
In short, an APN is a statutory demand for upfront payment of disputed tax issued to taxpayers involved in tax avoidance arrangements (whether under DOTAS, GAAR, or linked to a follower notice). It removes the cash-flow advantage of holding onto disputed tax during litigation, requiring payment within 90 days, while the underlying dispute continues to be resolved.
Citation sources
Where a person is disputing the liability of a charge under an avoidance scheme but has paid an amount via an accelerated payment notice in respect of any charges under that scheme, that person can apply for the loan charge to be postponed until the dispute is resolved. In order to be able to apply for such treatment, certain conditions need to be met. Firstly a person must be treated as taking a relevant step under the loan charge provisions, having made a loan or quasi-loan to a relevant perso
PART 4 Follower notices and accelerated payments CHAPTER 3 Accelerated payment Accelerated payment notices Content of notice given while a tax enquiry is in progress 220 1 This section applies where an accelerated payment notice is given by virtue of section 219(2)(a) (notice given while a tax enquiry is in progress). 2 The notice must— a specify the paragraph or paragraphs of section 219(4) by virtue of which the notice is given, b specify the payment (if any) required to be made under section
PART 4 Follower notices and accelerated payments CHAPTER 3 Accelerated payment Withdrawal etc of accelerated payment notice Withdrawal, modification or suspension of accelerated payment notice 227 1 In this section a “ Condition C requirement ” means one of the requirements set out in Condition C in section 219. 2 Where an accelerated payment notice has been given, HMRC may, at any time, by notice given to P— a withdraw the notice, b where the notice is given by virtue of more than one Condition
PART 4 Follower notices and accelerated payments CHAPTER 3 Accelerated payment Forms of accelerated payment Effect of notice given while tax enquiry is in progress : accelerated payment 223 1 This section applies where— a an accelerated payment notice is given by virtue of section 219(2)(a) (notice given while a tax enquiry is in progress) (and not withdrawn), and b an amount is stated in the notice in accordance with section 220(2)(b). 2 P must make a payment (“the accelerated payment”) to HMRC
The guidance about contract settlements at EM6000+ only relates to direct tax. You must never include VAT or VAT penalties in a contract settlement. If there is no penalties or surcharges included in the settlement, then neither should be included in the letter of offer and any reference to them in the template letters of offer in EMAPP1, should be deleted. Similarly, if there is no interest to be included in the settlement there should be no reference to interest in the offer. Please bear in mi
PART 4 Follower notices and accelerated payments CHAPTER 3 Accelerated payment Accelerated payment notices Circumstances in which an accelerated payment notice may be given 219 1 HMRC may give a notice (an “accelerated payment notice”) to a person (“P”) if Conditions A to C are met. 2 Condition A is that— a a tax enquiry is in progress into a return or claim made by P in relation to a relevant tax, or b P has made a tax appeal (by notifying HMRC or otherwise) in relation to a relevant tax but th