72 Recovery from employee of tax not deducted by employer
(1) This regulation applies if—
(a) it appears to the Inland Revenue that the deductible amount exceeds the amount actually deducted, and(2) In this regulation and regulations 72A and 72B—
(b) condition A or B is met.
“the deductible amount” is the amount which an employer was liable to deduct from relevant payments made to an employee in a tax period;(3) Condition A is that the employer satisfies the Inland Revenue—
“the amount actually deducted” is the amount actually deducted by the employer from relevant payments made to that employee during that tax period;
“the excess” means the amount by which the deductible amount exceeds the amount actually deducted.
(a) that the employer took reasonable care to comply with these Regulations, and(4) Condition B is that the Inland Revenue are of the opinion that the employee has received relevant payments knowing that the employer wilfully failed to deduct the amount of tax which should have been deducted from those payments.
(b) that the failure to deduct the excess was due to an error made in good faith.
(5) The Inland Revenue may direct that the employer is not liable to pay the excess to the Inland Revenue.
(5A) Any direction under paragraph (5) must be made by notice (“the direction notice”), stating the date the notice was issued, to—
(a) the employer and the employee if condition A is met;
(b) the employee if condition B is met.
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