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Finance (No. 3) BillPage 370

(b) payments made to the individual under or in consequence of the
agency contract, or treated as earnings under section 45 of ITEPA
2003, do not count as “relevant payments”.

(3) “Agency contract” and “remuneration” have the same meaning as in
5Chapter 7 of Part 2 of ITEPA 2003.

11 (1) This paragraph applies if—

(a) a person (“A”) performs in the United Kingdom duties of an
employment,

(b) the employment is under or with a person resident outside and not
10resident in the United Kingdom,

(c) the duties performed in the United Kingdom are performed for a
continuous period of not less than 30 days, and

(d) those duties are performed for the benefit of a person (“B”) resident
or carrying on a trade, profession or vocation in the United
15Kingdom.

(2) For the purposes of paragraph 9—

(a) B is treated as if B were an employer, but

(b) only the name and place of residence of A may be specified for a
relevant data-holder of B’s type in regulations made under
20paragraph 1(3).

Interest etc

12 (1) A person by or through whom interest is paid or credited is a relevant data-
holder.

(2) For the purposes of this paragraph, the following are to be treated as
25interest—

(a) a dividend in respect of a share in a building society,

(b) an amount to which a person holding a deeply discounted security
is entitled on the redemption of that security,

(c) a foreign dividend, and

(d) 30an alternative finance return.

(3) In sub-paragraph (2)—

Finance (No. 3) BillPage 371

Income, assets etc belonging to others

13 A person who (in whatever capacity) is in receipt of money or value of or
belonging to another is a relevant data-holder.

Payments derived from securities

14 (1) 5Each of the following is a relevant data-holder—

(a) a person who is the registered or inscribed holder of securities,

(b) a person who receives a payment derived from securities or would
be entitled to do so if a payment were made,

(c) a person who receives a payment treated by the company that makes
10it as a payment to which section 1033 of CTA 2010 applies (purchase
by unquoted trading company of own shares), and

(d) a person who receives a chargeable payment within the meaning of
Chapter 5 of Part 23 of CTA 2010 (company distributions:
demergers).

(2) 15But, for a relevant data-holder of a type described in this paragraph, data
may only be specified in regulations under paragraph 1(3) if the data
concern a matter mentioned in sub-paragraph (3).

(3) The matters are—

(a) whether the relevant data-holder is the beneficial owner (or sole
20beneficial owner) of the securities or payment in question,

(b) if not—

(i) details of the beneficial owner (or other beneficial owners),
and

(ii) if those details are not known or if different, details of the
25person for whom the securities are held or to whom the
payment is or may be paid on, and

(c) if there is more than one beneficial owner or more than one person of
the kind mentioned in paragraph (b)(ii), their respective interests in
the securities or payment.

(4) 30“Payment derived from securities” includes in particular—

(a) an amount (whether of income or capital) that is payable out of or in
respect of securities or rights attaching to securities, and

(b) a payment that is representative of any such amount.

15 (1) A person who makes a payment derived from securities that has been
35received from or is paid on behalf of another is a relevant data-holder.

(2) “Payment derived from securities” has the same meaning as in paragraph
14.

Grants and subsidies out of public funds

16 (1) A person by whom a payment out of public funds is made by way of grant
40or subsidy is a relevant data-holder.

(2) For these purposes, a payment is a payment out of public funds if it is
provided directly or indirectly by—

(a) the Crown,

Finance (No. 3) BillPage 372

(b) any government, public or local authority whether in the United
Kingdom or elsewhere, or

(c) any EU institution.

Licences, approvals etc

17 (1) 5A person by whom licences or approvals are issued or a register is
maintained is a relevant data-holder.

(2) “Register” includes—

(a) any record or list that a local authority maintains, and

(b) any record or list that any other person is required or permitted to
10maintain by or under an enactment.

Rent and other payments arising from land

18 (1) Each of the following is a relevant data-holder—

(a) a lessee (or successor in title of a lessee),

(b) an occupier of land,

(c) 15a person having the use of land, and

(d) a person who, as agent, manages land or is in receipt of rent or other
payments arising from land.

(2) The reference to a person who manages land includes a person who markets
property to potential tenants, searches for tenants or provides similar
20services.

Dealing etc in securities

19 (1) Each of the following is a relevant data-holder—

(a) a person who effects or is a party to securities transactions wholly or
partly on behalf of others (whether as agent or principal),

(b) 25a person who, in the course of business, acts as registrar or
administrator in respect of securities transactions (including a
person who manages a clearing house for any terminal market in
securities),

(c) a person who makes a payment derived from securities to anyone
30other than the registered or inscribed holder of the securities,

(d) a person who makes a payment derived from bearer securities, and

(e) an accountable person within the meaning of the Stamp Duty
Reserve Tax Regulations 1986 (S.I. 1986/1711S.I. 1986/1711).

(2) “Payment derived from securities” has the same meaning as in paragraph 14
35(and “payment derived from bearer securities” is to be read accordingly).

(3) “Securities transactions” means—

(a) transactions in securities,

(b) transactions under which a representative payment has been, is to be
or may be made, or

(c) 40the making or receipt of a representative payment.

(4) In sub-paragraph (3)—

Dealing in other property

20 Each of the following is a relevant data-holder—

(a) the committee or other person or body of persons responsible for
managing a clearing house for any terminal market in commodities,

(b) 15an auctioneer,

(c) a person carrying on a business of dealing in any description of
tangible movable property, and

(d) a person carrying on a business of acting as an agent or intermediary
in dealings in any description of tangible movable property.

20Lloyd’s

21 A person who is registered as managing agent at Lloyd’s in relation to a
syndicate of underwriting members of Lloyd’s is a relevant data-holder.

Investment plans etc

22 Each of the following is a relevant data-holder—

(a) 25a plan manager (see section 696 of ITTOIA 2005), and

(b) an account provider in relation to a child trust fund (as defined in
section 3 of the Child Trust Funds Act 2004).

Petroleum activities

23 Each of the following is a relevant data-holder—

(a) 30the holder of a licence granted under Part 1 of the Petroleum Act
1998, and

(b) the responsible person in relation to an oil field (within the meaning
of Part 1 of OTA 1975).

Insurance activities

24 35Each of the following is a relevant data-holder—

(a) a person who is involved (in any capacity) in an insurance business
(as defined for the purposes of Part 3 of FA 1994),

(b) a person who makes arrangements for persons to enter into contracts
of insurance, and

(c) 40a person who is concerned in a business that is not an insurance
business and who has been involved in the entering into of a contract

Finance (No. 3) BillPage 374

of insurance that provides cover for any matter associated with the
business.

Environmental activities

25 A person who is involved (in any capacity) in any of the following activities
5is a relevant data-holder—

(a) subjecting aggregate to exploitation in the United Kingdom (as
defined for the purposes of Part 2 of FA 2001) or connected activities,

(b) making or receiving supplies of taxable commodities (as defined for
the purposes of Schedule 6 to FA 2000) or connected activities, and

(c) 10landfill disposal (as defined for the purposes of Part 3 of FA 1996).

Settlements

26 (1) Each of the following is a relevant data-holder—

(a) a person who makes a settlement,

(b) the trustees of a settlement,

(c) 15a beneficiary under a settlement, and

(d) any other person to whom income is payable under a settlement.

(2) Section 620 of ITTOIA 2005 (meaning of “settlement” etc) applies for the
purposes of this paragraph.

Charities

27 20A charity is a relevant data-holder.

Part 3 Appeals against data-holder notices

Right of appeal

28 (1) The data-holder may appeal against a data-holder notice, or any
25requirement in such a notice, on any of the following grounds—

(a) it is unduly onerous to comply with the notice or requirement,

(b) the data-holder is not a relevant data-holder, or

(c) data specified in the notice are not relevant data.

(2) Sub-paragraph (1)(a) does not apply to a requirement to provide data that
30form part of the data-holder’s statutory records.

(3) Sub-paragraph (1) does not apply if the tribunal approved the giving of the
notice in accordance with paragraph 5.

Procedure for appeal

29 (1) Notice of an appeal under paragraph 28 must be given—

(a) 35in writing,

(b) before the end of the period of 30 days beginning with the date on
which the data-holder notice was given, and

(c) to the officer of Revenue and Customs by whom the data-holder
notice was given.

Finance (No. 3) BillPage 375

(2) It must state the grounds of appeal.

(3) On an appeal that is notified to the tribunal, the tribunal may confirm, vary
or set aside the data-holder notice or a requirement in it.

(4) If the tribunal confirms or varies the notice or a requirement in it, the data-
5holder must comply with the notice or requirement—

(a) within such period as is specified by the tribunal, or

(b) if the tribunal does not specify a period, within such period as is
reasonably specified in writing by an officer of Revenue and
Customs following the tribunal’s decision.

(5) 10A decision by the tribunal under this Part is final (despite the provisions of
sections 11 and 13 of the Tribunals, Courts and Enforcement Act 2007).

(6) Subject to this paragraph, the provisions of Part 5 of TMA 1970 relating to
appeals have effect in relation to appeals under paragraph 28 as they have
effect in relation to an appeal against an assessment to income tax.

15Part 4 Penalties

Penalties for failure to comply

30 (1) If the data-holder fails to comply with a data-holder notice, the data-holder
is liable to a penalty of £300.

(2) 20A reference in this Schedule to failing to comply with a data-holder notice
includes—

(a) concealing, destroying or otherwise disposing of a material
document, or

(b) arranging for any such concealment, destruction or disposal.

(3) 25A document is a material document if, at the time when the data-holder
acts—

(a) the data-holder has received a data-holder notice requiring the data-
holder to provide the document or data contained in the document,
or

(b) 30the data-holder has not received such a notice but has been informed
by an officer of Revenue and Customs that the data-holder will do so
or is likely to do so.

(4) A document is not a material document by virtue of sub-paragraph (3)(a) if
the data-holder notice has already been complied with, unless—

(a) 35the data-holder has been notified in writing by an officer of Revenue
and Customs that the data-holder must continue to preserve the
document, and

(b) the notification has not been withdrawn.

(5) A document is not a material document by virtue of sub-paragraph (3)(b) if
40more than 6 months have elapsed since the data-holder was (or was last)
informed.

Finance (No. 3) BillPage 376

Daily default penalties for failure to comply

31 If—

(a) a penalty under paragraph 30 is assessed, and

(b) the failure in question continues after the data-holder has been
5notified of the assessment,

the data-holder is liable to a further penalty, for each subsequent day on
which the failure continues, of an amount not exceeding £60 for each such
day.

Penalties for inaccurate information or documents

32 (1) 10This paragraph applies if—

(a) in complying with a data-holder notice, the data-holder provides
inaccurate data, and

(b) condition A, B or C is met.

(2) Condition A is that the inaccuracy is—

(a) 15due to a failure by the data-holder to take reasonable care, or

(b) deliberate on the data-holder’s part.

(3) Condition B is that the data-holder knows of the inaccuracy at the time the
data are provided but does not inform HMRC at that time.

(4) Condition C is that the data-holder—

(a) 20discovers the inaccuracy some time later, and

(b) fails to take reasonable steps to inform HMRC.

(5) If this paragraph applies, the data-holder is liable to a penalty not exceeding
£3,000.

Failure to comply with time limit

33 25A failure to do anything required to be done within a limited period of time
does not give rise to liability under paragraph 30 or 31 if the thing was done
within such further time (if any) as an officer of Revenue and Customs may
have allowed.

Reasonable excuse

34 (1) 30Liability to a penalty under paragraph 30 or 31 does not arise if the data-
holder satisfies HMRC or (on an appeal notified to the tribunal) the tribunal
that there is a reasonable excuse for the failure.

(2) For the purposes of this paragraph—

(a) an insufficiency of funds is not a reasonable excuse unless
35attributable to events outside the data-holder’s control,

(b) if the data-holder relies on another person to do anything, that is not
a reasonable excuse unless the data-holder took reasonable care to
avoid the failure,

(c) if the data-holder had a reasonable excuse for the failure but the
40excuse has ceased, the data-holder is to be treated as having
continued to have the excuse if the failure is remedied without
unreasonable delay after the excuse ceased.

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Assessment of penalties

35 (1) If the data-holder becomes liable to a penalty under paragraph 30, 31 or 32,
HMRC may assess the penalty.

(2) If they do so, they must notify the data-holder.

(3) 5An assessment of a penalty under paragraph 30 or 31 must be made within
the period of 12 months beginning with the latest of the following—

(a) the date on which the data-holder became liable to the penalty,

(b) the end of the period in which notice of an appeal against the data-
holder notice (or a requirement in it) could have been given, and

(c) 10if notice of such an appeal is given, the date on which the appeal is
determined or withdrawn.

(4) An assessment of a penalty under paragraph 32 must be made—

(a) within the period of 12 months beginning with the date on which the
inaccuracy first came to the attention of an officer of Revenue and
15Customs, and

(b) within the period of 6 years beginning with the date on which the
data-holder became liable to the penalty.

Right to appeal against penalty

36 The data-holder may appeal against a decision by an officer of Revenue and
20Customs—

(a) that a penalty is payable under paragraph 30, 31 or 32, or

(b) as to the amount of such a penalty.

Procedure on appeal against penalty

37 (1) Notice of an appeal under paragraph 36 must be given—

(a) 25in writing,

(b) before the end of the period of 30 days beginning with the date on
which notification under paragraph 35 was given, and

(c) to HMRC.

(2) It must state the grounds of appeal.

(3) 30On an appeal under paragraph 36(a) that is notified to the tribunal, the
tribunal may confirm or cancel the decision.

(4) On an appeal under paragraph 36(b) that is notified to the tribunal, the
tribunal may—

(a) confirm the decision, or

(b) 35substitute for the decision another decision that the officer of
Revenue and Customs had power to make.

(5) Subject to this paragraph and paragraph 40, the provisions of Part 5 of TMA
1970 relating to appeals have effect in relation to appeals under paragraph
36 as they have effect in relation to an appeal against an assessment to
40income tax.

Finance (No. 3) BillPage 378

Increased daily default penalty

38 (1) This paragraph applies if—

(a) a penalty under paragraph 31 is assessed under paragraph 35,

(b) the failure in respect of which that assessment is made continues for
5more than 30 days beginning with the date on which notification of
that assessment is given, and

(c) the data-holder has been told that an application may be made under
this paragraph for an increased daily penalty to be imposed.

(2) If this paragraph applies, an officer of Revenue and Customs may make an
10application to the tribunal for an increased daily penalty to be imposed on
the data-holder.

(3) If the tribunal decides that an increased daily penalty should be imposed,
then for each applicable day (see paragraph 39) on which the failure
continues—

(a) 15the data-holder is not liable to a penalty under paragraph 31 in
respect of the failure, and

(b) the data-holder is liable instead to a penalty under this paragraph of
an amount determined by the tribunal.

(4) The tribunal may not determine an amount exceeding £1,000 for each
20applicable day.

(5) But subject to that, in determining the amount the tribunal must have regard
to—

(a) the likely cost to the data-holder of complying with the data-holder
notice,

(b) 25any benefits to the data-holder of not complying with it, and

(c) any benefits to anyone else resulting from the data-holder’s non-
compliance.

39 (1) If a data-holder becomes liable to a penalty under paragraph 38, HMRC
must notify the data-holder.

(2) 30The notification must specify the day from which the increased penalty is to
apply.

(3) That day and any subsequent day is an “applicable day” for the purposes of
paragraph 38(3).

Enforcement of penalties

40 (1) 35A penalty under this Schedule must be paid before the end of the period of
30 days beginning with the date mentioned in sub-paragraph (2).

(2) That date is—

(a) the date on which notification under paragraph 35 or 39 is given in
respect of the penalty, or

(b) 40if (in the case of a penalty under paragraph 30, 31 or 32) a notice of
appeal under paragraph 36 is given, the date on which the appeal is
finally determined or withdrawn.

(3) A penalty under this Schedule may be enforced as if it were income tax
charged in an assessment and due and payable.

Finance (No. 3) BillPage 379

Power to change amount of penalties

41 (1) If it appears to the Treasury that there has been a change in the value of
money since the last relevant date, they may by regulations substitute for the
sums for the time being specified in paragraphs 30(1), 31, 32(5) and 38(4)
5such other sums as appear to them to be justified by the change.

(2) “Relevant date”, in relation to a specified sum, means—

(a) the day on which this Act is passed, and

(b) each date on which the power conferred by sub-paragraph (1) has
been exercised in relation to that sum.

(3) 10Regulations under this paragraph do not apply to—

(a) a failure which began before the date on which they come into force,
or

(b) an inaccuracy in any data or document provided to HMRC before
that date.

15Double jeopardy

42 The data-holder is not liable to a penalty under this Schedule in respect of
anything in respect of which the data-holder has been convicted of an
offence.

Part 5 20Miscellaneous provision and interpretation

Application of provisions of TMA 1970

43 Subject to the provisions of this Schedule, the following provisions of TMA
1970 apply for the purposes of this Schedule as they apply for the purposes
of the Taxes Acts—

(a) 25section 108 (responsibility of company officers),

(b) section 114 (want of form), and

(c) section 115 (delivery and service of documents).

Regulations

44 (1) Regulations under this Schedule are to be made by statutory instrument.

(2) 30The first regulations to be made under paragraph 1(3) may not be made
unless the instrument containing them has been laid in draft before, and
approved by a resolution of, the House of Commons.

(3) Subject to sub-paragraph (2), a statutory instrument containing regulations
under this Schedule is subject to annulment in pursuance of a resolution of
35the House of Commons.

Tax

45 (1) In this Schedule “tax” means any or all of the following—

(a) income tax,

(b) capital gains tax,

(c) 40corporation tax,

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