Finance Bill (HC Bill 102)

Finance BillPage 560

(5) An application for an approval must be made in such form and manner, and
contain such information, as may be specified by, or on behalf of, the
Commissioners for Her Majesty’s Revenue and Customs.

(6) An officer of Revenue and Customs must notify the applicant of the decision
5on an application.

Approval: qualifying payments condition

17 (1) The qualifying payments condition is met in relation to a qualifying loan if,
during the relevant period—

(a) payments have been made in respect of the repayment of the
10principal of the loan, and

(b) the payments have been made at intervals not exceeding 53 weeks.

(2) The “relevant period” in relation to a loan is the period beginning with the
making of the loan and ending with the making of the application.

Approval: commercial terms condition

18 (1) 15The commercial terms condition is met in relation to a qualifying loan if—

(a) either—

(i) it is reasonable to assume that, had the qualifying loan been
made in the ordinary course of a lending business, loans on
terms comparable to those of the qualifying loan would have
20been available to members of the public, or

(ii) the qualifying loan was made in the ordinary course of a
lending business; and

(b) the borrower has, in all material respects, complied with the terms of
the loan.

(2) 25For the purposes of sub-paragraph (1), a loan is made in the ordinary course
of a lending business if it is made by a person in the ordinary course of a
business carried on by the person which includes—

(a) the lending of money, or

(b) the supplying of goods or services on credit.

30Accelerated payments

19 (1) Paragraph 20(1) applies where—

(a) section 23E of ITTOIA 2005 would (ignoring paragraph 20) apply in
relation to a relevant benefit arising to T,

(b) the relevant benefit is a loan or quasi-loan in relation to which
35paragraph 1(2) applies,

(c) an accelerated payment notice, or a partner payment notice, relating
to a relevant charge (the “accelerated payment notice”) has been
given under Chapter 3 of Part 4 of FA 2014,

(d) T makes a payment (the “accelerated payment”) in respect of the
40understated or disputed tax to which the notice relates,

(e) the accelerated payment is made on or before the relevant date, and

(f) the amount of the loan or quasi-loan that, at the end of the relevant
date, is outstanding for the purposes of paragraph 1 (see paragraphs
3 to 14) is equal to or less than the amount of the accelerated
45payment.

Finance BillPage 561

(2) In sub-paragraph (1)(c), “relevant charge” means a charge to tax under
section 23E of ITTOIA 2005 arising by reason of a relevant benefit which
arises to T in pursuance of the relevant arrangement in pursuance of which
the relevant benefit mentioned in sub-paragraph (1)(a) and (b) arises.

(3) 5In sub-paragraph (1)(e) and (f), “the relevant date” means—

(a) the approved repayment date, if the relevant benefit is an approved
fixed term loan on 5 April 2019, or

(b) 5 April 2019, in any other case.

20 (1) T may make an application to the Commissioners for Her Majesty’s Revenue
10and Customs to be treated—

(a) as if the relevant benefit mentioned in paragraph 19(1)(a) and (b)
arises only if the condition in sub-paragraph (2) is met, and

(b) as if it arises immediately before the end of the 30 days beginning
with the date on which the condition in sub-paragraph (2) becomes
15met.

(2) The condition is that, on the withdrawal of the accelerated payment notice
or on the determination of an appeal, any part of the accelerated payment is
repaid.

(3) Subject to sub-paragraph (4), an application under sub-paragraph (1) may be
20made in 2018.

(4) An application may be made after 2018 if an officer of Revenue and Customs
considers it reasonable in all the circumstances for a late application to be
made.

(5) An application must be made in such form and manner, and contain such
25information, as may be specified by, or on behalf of, the Commissioners for
Her Majesty’s Revenue and Customs.

(6) An officer of Revenue and Customs must notify the applicant of the decision
on an application under this paragraph.

Section 55

SCHEDULE 13 30Third country goods fulfilment businesses: penalty

Liability to penalty

1 (1) A penalty is payable by a person (“P”) who—

(a) carries on a third country goods fulfilment business, and

(b) is not an approved person.

(2) 35In this Schedule references to a “contravention” are to acting as mentioned
in sub-paragraph (1).

Amount of penalty

2 (1) If the contravention is deliberate and concealed, the amount of the penalty
is the maximum amount (see paragraph 10).

Finance BillPage 562

(2) If the contravention is deliberate but not concealed, the amount of the
penalty is 70% of the maximum amount.

(3) In any other case, the amount of the penalty is 30% of the maximum amount.

(4) The contravention is—

(a) 5“deliberate and concealed” if the contravention is deliberate and P
makes arrangements to conceal the contravention, and

(b) “deliberate but not concealed” if the contravention is deliberate but
P does not make arrangements to conceal the contravention.

Reductions for disclosure

3 (1) 10Paragraph 4 provides for reductions in penalties under this Schedule where
P discloses a contravention.

(2) P discloses a contravention by—

(a) telling the Commissioners about it,

(b) giving the Commissioners reasonable help in identifying any other
15contraventions of which P is aware, and

(c) allowing the Commissioners access to records for the purpose of
identifying such contraventions.

(3) Disclosure of a contravention—

(a) is “unprompted” if made at a time when P has no reason to believe
20that the Commissioners have discovered or are about to discover the
contravention, and

(b) otherwise, is “prompted”.

(4) In relation to disclosure, “quality” includes timing, nature and extent.

4 (1) Where P discloses a contravention, the Commissioners must reduce the
25penalty to one that reflects the quality of the disclosure.

(2) If the disclosure is prompted, the penalty may not be reduced below—

(a) in the case of a contravention that is deliberate and concealed, the
maximum amount,

(b) in the case of a contravention that is deliberate but not concealed,
3035% of the maximum amount, and

(c) in any other case, 20% of the maximum amount.

(3) If the disclosure is unprompted, the penalty may not be reduced below—

(a) in the case of a contravention that is deliberate and concealed, 30% of
the maximum amount,

(b) 35in the case of a contravention that is deliberate but not concealed,
20% of the maximum amount, and

(c) in any other case, 10% of the maximum amount.

Special reduction

5 (1) If the Commissioners think it right because of special circumstances, they
40may reduce a penalty under this Schedule.

(2) In sub-paragraph (1) “special circumstances” does not include ability to pay.

Finance BillPage 563

(3) In sub-paragraph (1) the reference to reducing a penalty includes a reference
to—

(a) staying a penalty, and

(b) agreeing a compromise in relation to proceedings for a penalty.

5Assessment

6 (1) Where P becomes liable for a penalty under this Schedule, the
Commissioners must—

(a) assess the penalty,

(b) notify P, and

(c) 10state in the notice the contravention in respect of which the penalty
is assessed.

(2) A penalty under this Schedule must be paid before the end of the period of
30 days beginning with the day on which notification of the penalty is
issued.

(3) 15A penalty under this Schedule is recoverable as a debt due to the Crown.

(4) An assessment of a penalty under this Schedule may not be made later than
one year after evidence of facts sufficient in the opinion of the
Commissioners to indicate the contravention comes to their knowledge.

(5) Two or more contraventions may be treated by the Commissioners as a
20single contravention for the purposes of assessing a penalty under this
Schedule.

Reasonable excuse

7 (1) Liability to a penalty does not arise under this Schedule in respect of a
contravention which is not deliberate if P satisfies the Commissioners or (on
25an appeal made to the appeal tribunal) the tribunal that there is a reasonable
excuse for the contravention.

(2) For the purposes of sub-paragraph (1), where P relies on any other person to
do anything, that is not a reasonable excuse unless P took reasonable care to
avoid the contravention.

30Companies: officer’s liability

8 (1) Where a penalty under this Schedule is payable by a company in respect of
a contravention which was attributable to an officer of the company, the
officer is liable to pay such portion of the penalty (which may be 100%) as
the Commissioners may specify by written notice to the officer.

(2) 35Sub-paragraph (1) does not allow the Commissioners to recover more than
100% of a penalty.

(3) In the application of sub-paragraph (1) to a body corporate other than a
limited liability partnership, “officer” means—

(a) a director (including a shadow director within the meaning of
40section 251 of the Companies Act 2006),

(b) a manager, and

(c) a secretary.

Finance BillPage 564

(4) In the application of sub-paragraph (1) to a limited liability partnership,
“officer” means a member.

(5) In the application of sub-paragraph (1) in any other case, “officer” means—

(a) a director,

(b) 5a manager,

(c) a secretary, and

(d) any other person managing or purporting to manage any of the
company’s affairs.

(6) Where the Commissioners have specified a portion of a penalty in a notice
10given to an officer under sub-paragraph (1)—

(a) paragraph 5 applies to the specified portion as to a penalty,

(b) the officer must pay the specified portion before the end of the period
of 30 days beginning with the day on which the notice is given,

(c) sub-paragraphs (3) to (5) of paragraph 6 apply as if the notice were
15an assessment of a penalty, and

(d) paragraph 9 applies as if the officer were liable to a penalty.

(7) In this paragraph “company” means any body corporate or unincorporated
association, but does not include a partnership.

Double jeopardy

9 20P is not liable to a penalty under this Schedule in respect of a contravention
in respect of which P has been convicted of an offence.

The maximum amount

10 (1) In this Schedule “the maximum amount” means £10,000.

(2) If it appears to the Treasury that there has been a change in the value of
25money since the last relevant date, they may by regulations substitute for the
sum for the time being specified in sub-paragraph (1) such other sum as
appears to them to be justified by the change.

(3) In sub-paragraph (2), “relevant date” means—

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

(b) 30each date on which the power conferred by that sub-paragraph has
been exercised.

(4) Regulations under this paragraph do not apply to any contravention which
occurs wholly before the date on which they come into force.

Appeal tribunal

11 35In this Schedule “appeal tribunal” has the same meaning as in Chapter 2 of
Part 1 of the Finance Act 1994.

Finance BillPage 565

Section 61

SCHEDULE 14 Digital reporting and record-keeping for income tax etc: further amendments

Part 1 Amendments of TMA 1970

1 5TMA 1970 is amended as follows.

2 (1) Section 7 (notice of liability) is amended as follows.

(2) In subsection (1A) for the words from “under section 8” to the end substitute
“to file under section 8 for the year of assessment”.

(3) In subsection (1B)(a) for the words from “under section 8” to “gains”
10substitute “to file under section 8 for the year of assessment”.

(4) In subsection (7) for “section 9” substitute “section 8 or 8A”.

3 (1) Section 8 (personal return) is amended as follows.

(2) For the heading substitute “Notices to file: persons other than trustees”.

(3) For subsection (1) substitute—

(1) 15For the purpose of establishing—

(a) the amounts in which a person is chargeable to income tax
and capital gains tax for a year of assessment, and

(b) the amount payable by the person by way of income tax for
the year,

20an officer of Revenue and Customs may give the person a notice to
file for the year of assessment.”

(4) In subsection (1AA)(a) for “return” substitute “information filed in response
to the notice to file or in any end of period statement for the year of
assessment provided to HMRC by the person”.

(5) 25After subsection (1AA) insert—

(1AB) A notice to file for a year of assessment is a notice requiring the
person concerned—

(a) to file the following for that year (in addition to any end of
period statement for the year that may be required by
30regulations under paragraph 8 of Schedule A1)—

(i) such information as may reasonably be required in
pursuance of the notice for the purpose mentioned in
subsection (1),

(ii) a self-assessment (but see section 9(2)), and

(iii) 35a final declaration, and

(b) to deliver to HMRC such accounts, statements, or other
documents (relating to the information filed as mentioned in
paragraph (a)(i) and (ii)) as may reasonably be required for
the purpose mentioned in subsection (1).

(1AC) 40The duty to file the things mentioned in subsection (1AB)(a) is to be
complied with—

Finance BillPage 566

(a) where the person is not required to provide an end of period
statement for the year, by making and delivering to HMRC a
return containing those things, and

(b) where the person is required to provide such a statement,
5by—

(i) making and delivering to HMRC a return containing
those things, or

(ii) providing those things to HMRC using the facility to
file mentioned in paragraph 9 of Schedule A1.

(1AD) 10It is immaterial that any of the information required as mentioned in
subsection (1AB)(a)(i) in response to a notice to file has been
provided to HMRC before the date of the notice.”

(6) In subsection (1B)—

(a) for “a return under this section” substitute “the information filed in
15response to a notice to file”;

(b) after “relevant” insert “partnership”.

(7) In subsection (1C)—

(a) after ““relevant” insert “partnership”;

(b) after “means a” insert “partnership”;

(c) 20for “of this Act” substitute “, or under regulations under paragraph
10 of Schedule A1,”.

(8) For subsection (1D) substitute—

(1D) Where the method to be used for complying with a notice to file for
a year of assessment (Year 1) is filing a return—

(a) 25if the return is a non-electronic return, the person must
comply with the notice on or before 31 October in Year 2, and

(b) if the return is an electronic return, the person must comply
with the notice on or before 31 January in Year 2.”

(9) In subsection (1F) for “a return” substitute “the return”.

(10) 30In subsection (1G) for “a return” substitute “the return”.

(11) After subsection (1H) insert—

(1HA) Where the method to be used for complying with a notice to file for
a year of assessment (Year 1) is using the facility mentioned in
paragraph 9 of Schedule A1, the person must comply with the notice
35on or before—

(a) 31 January in Year 2, or

(b) if later, the last day of the period of 3 months beginning with
the date of the notice.”

(12) For subsection (2) substitute—

(2) 40The final declaration required by a notice to file is a declaration by
the person concerned to the effect that to the best of the person’s
knowledge the information and self-assessment filed in response to
the notice are (taken together) correct and complete.”

(13) In subsections (3), (4) and (4A) for “under this section” substitute “to file”.

Finance BillPage 567

(14) In subsection (4B) for the words from “may” to “income” substitute “to file
may require the information filed in response”.

(15) After subsection (5) insert—

(6) In this section “notice to file” means a notice to file under this section.

(7) 5In the Taxes Acts, unless the contrary intention appears, a reference
(whether specific or general)—

(a) to a return under this section for a year of assessment, is to—

(i) the information, self-assessment and final declaration
filed for the year under this section, and

(ii) 10any end of period statement for the year provided to
HMRC;

(b) to anything required to be included in a return under this
section for a year of assessment, is to—

(i) the information, self-assessment and final declaration
15required to be filed for the year under this section,
and

(ii) any end of period statement for the year required to
be provided to HMRC, and

(c) to making or delivering a return under this section, is to—

(i) 20making or delivering a return as mentioned in
subsection (1AC)(a) or (b)(i), or

(ii) if the response to a notice to file is made using the
facility mentioned in paragraph 9 of Schedule A1,
making the final declaration required by the notice.”

4 (1) 25Section 8A (trustee’s return) is amended as follows.

(2) For the heading substitute “Notices to file: trustees”.

(3) For subsection (1) substitute—

(1) For the purpose of establishing—

(a) the amounts in which the relevant trustees of a settlement,
30and the settlors and beneficiaries, are chargeable to income
tax and capital gains tax for a year of assessment, and

(b) the amount payable by them by way of income tax for the
year,

an officer of Revenue and Customs may give any relevant trustee a
35notice to file for the year of assessment.

(1ZA) A notice to file may be given to any one trustee or separate notices
may be given to each trustee or to such trustees as the officer giving
the notice thinks fit.”

(4) In subsection (1AA)(a) for “return” substitute “information filed in response
40to the notice to file or in any end of period statement for the year of
assessment provided to HMRC by the relevant trustees”.

(5) After subsection (1AA) insert—

(1AB) A notice to file for a year of assessment is a notice requiring the
trustee to whom it is given—

Finance BillPage 568

(a) to file the following for that year (in addition to any end of
period statement for the year that may be required by
regulations under paragraph 8 of Schedule A1)—

(i) such information as may reasonably be required in
5pursuance of the notice for the purpose mentioned in
subsection (1),

(ii) a self-assessment (but see section 9(2)), and

(iii) a final declaration, and

(b) to deliver to HMRC such accounts, statements, or other
10documents (relating to the information filed as mentioned in
paragraph (a)(i) and (ii)) as may reasonably be required for
the purpose mentioned in subsection (1).

(1AC) The duty to file the things mentioned in subsection (1AB)(a) is to be
complied with—

(a) 15where the relevant trustees are not required to provide an
end of period statement for the year, by the trustee making
and delivering to HMRC a return containing those things,
and

(b) where the relevant trustees are required to provide such a
20statement, by the trustee—

(i) making and delivering to HMRC a return containing
those things, or

(ii) providing those things to HMRC using the facility to
file mentioned in paragraph 9 of Schedule A1.

(1AD) 25It is immaterial that any of the information required as mentioned in
subsection (1AB)(a)(i) in response to a notice to file has been
provided to HMRC before the date of the notice.”

(6) For subsection (1B) substitute—

(1B) Where the method to be used by the trustee for complying with a
30notice to file for a year of assessment (Year 1) is filing a return—

(a) if the return is a non-electronic return, the trustee must
comply with the notice on or before 31 October in Year 2, and

(b) if the return is an electronic return, the trustee must comply
with the notice on or before 31 January in Year 2.”

(7) 35In subsection (1D) for “a return” substitute “the return”.

(8) In subsection (1E) for “a return” substitute “the return”.

(9) After subsection (1F) insert—

(1FA) Where the method to be used for complying with a notice to file for
a year of assessment (Year 1) is using the facility mentioned in
40paragraph 9 of Schedule A1, the trustee must comply with the notice
on or before—

(a) 31 January in Year 2, or

(b) if later, the last day of the period of 3 months beginning with
the date of the notice.”

Finance BillPage 569

(10) For subsection (2) substitute—

(2) The final declaration required by a notice to file is a declaration by
the trustee to the effect that to the best of the trustee’s knowledge the
information and self-assessment filed in response to the notice are
5(taken together) correct and complete.”

(11) In subsections (3) and (4) for “under this section” substitute “to file”.

(12) After subsection (5) insert—

(6) In this section “notice to file” means a notice to file under this section.

(7) In the Taxes Acts, unless the contrary intention appears, a reference
10(whether specific or general)—

(a) to a return under this section for a year of assessment, is to—

(i) the information, self-assessment and final declaration
filed for the year under this section, and

(ii) any end of period statement for the year provided to
15HMRC,

(b) to anything required to be included in a return under this
section for a year of assessment, is to—

(i) the information, self-assessment and final declaration
required to be filed for the year under this section,
20and

(ii) any end of period statement for the year required to
be provided to HMRC, and

(c) to making or delivering a return under this section, is to—

(i) making or delivering a return as mentioned in
25subsection (1AC)(a) or (b)(i), or

(ii) if the response to a notice to file is made using the
facility mentioned in paragraph 9 of Schedule A1,
making the final declaration required by the notice.”

5 In section 8B (withdrawal of notice under section 8 or 8A)—

(a) 30in the heading after “notice” insert “to file”;

(b) in subsection (1) after “notice” insert “to file”.

6 (1) Section 9 (returns to include self-assessment) is amended as follows.

(2) For the heading substitute “Self-assessment required by a notice to file”.

(3) In subsection (1) for the words from the beginning to “say—” substitute
35“Subject to subsection (1A), the self-assessment required by virtue of
subsection (1AB)(a) of section 8 or 8A from a person given a notice to file for
a year of assessment is—”.

(4) In subsection (2) for “to comply with subsection (1) above” substitute “by
virtue of section 8 or 8A to make and file a self-assessment”.

(5) 40In subsection (3) for the words from “, a person” to “above” substitute
“required by virtue of section 8 or 8A, a person does not include a self-
assessment”.

(6) In subsection (3A) after “self-assessment” insert “under section 8 or 8A”.

7 (1) Section 12ZH (NRCGT returns and self-assessment: section 8) is amended as
45follows.