On 28 March 2017, an order was made to enact certain Extra-Statutory Concessions (ESC). This includes ESC 3.20, which disapplies the clawback of VAT input tax credit where a business has entered insolvency proceedings and has not paid (or has only partially paid) the consideration for the supply.

The Order came into force on 6 April 2017 and inserts a new section 26AA into the Value Added Tax Act 1994 (VATA 1994), which disapplies section 26A (disallowance of input tax where consideration not paid) where certain conditions are satisfied.

The Enactment of Extra-Statutory Concession Order 2017 is available to view here.