Finance (No. 3) Bill (HL Bill 304)

(5) Regulations under subsection (4) may amend, repeal or revoke any enactment
(whenever passed or made).

General

76 Interpretation

(1) 5In this Part—

• “the Commissioners” means the Commissioners for Her Majesty’s
  Revenue and Customs;

• “emissions allowance” has the meaning given by section 72;

• “emissions determination” has the meaning given by section 70;

• 10“the Emissions Regulations” means the Greenhouse Gas Emissions
  Trading Scheme Regulations 2012 (S.I. 2012/3038S.I. 2012/3038);

• “emissions report” has the meaning given by section 71;

• “enactment” includes an enactment contained in subordinate legislation
  within the meaning of the Interpretation Act 1978;

• 15“HMRC” means Her Majesty’s Revenue and Customs;

• “installation” has the meaning given by regulation 3 of the Emissions
  Regulations (and references to an installation include references to an
  offshore installation, as defined in those Regulations);

• “the Monitoring and Reporting Regulation” means Commission
  20Regulation (EU) No 601/2012 of 21 June 2012 on the monitoring and
  reporting of greenhouse gas emissions pursuant to Directive 2003/87/
  EC of the European Parliament and of the Council (as amended from
  time to time);

• “operator” has the meaning given by regulation 3 of the Emissions
  25Regulations (as read with Schedule 1 to those Regulations);

• “reporting period” has the meaning given by section 71 (subject to section
  78(4));

• “specified” means specified in regulations under this Part;

• “the Verification Regulation” means Commission Regulation (EU) No
  30600/2012 of 21 June 2012 on the verification of greenhouse gas emission
  reports and tonne-kilometre reports and the accreditation of verifiers
  pursuant to Directive 2003/87/EC of the European Parliament and of
  the Council (as amended from time to time).

(2) In this Part, the following terms have the meaning given by regulation 3 of the
35Emissions Regulations—

• “authority”,

• “emissions”,

• “excluded installation”,

• “monitoring and reporting conditions”,

• 40“monitoring and reporting requirements”,

• “notice of surrender”,

• “permit”,

• “regulator”,

• “revocation notice”,

• 45“scheme year”, and

• “tonne of carbon dioxide equivalent”.

(3) An “installation” is a “regulated installation” for a reporting period if, at any
time during the period, the operator holds a permit for the installation.

(4) References in this Part to the Verification Regulation or the Monitoring and
Reporting Regulation include references to any EU regulation which replaces
5either of them and forms part of the law of the United Kingdom as a result of
section 3 of the European Union (Withdrawal) Act 2018 (and accordingly the
reference in section 70(2)(a) to article 70 of the Monitoring and Reporting
Regulation includes a reference to the corresponding provision in any such
replacement of that Regulation).

77 10Regulations

(1) Regulations under section 72, 74 or 75 may—

(a) make provision conferring functions or discretions on an authority, a
regulator or any other person;

(b) impose charges as a means of recovering costs incurred by a person in
15exercising a function conferred under the regulations;

(c) make provision by reference to matters determined or published by
HMRC, the Secretary of State, an authority or a regulator (whether
before or after the regulations are made);

(d) make different provision for different purposes;

(e) 20include incidental, consequential, supplementary, transitional or
transitory provision.

(2) Regulations under this Part are to be made by statutory instrument.

(3) A statutory instrument containing regulations under section 75(4) that makes
provision amending or repealing any provision of an Act of Parliament may
25not be made unless a draft of the instrument has been laid before and approved
by a resolution of the House of Commons.

(4) Any other statutory instrument containing regulations under this Part is
subject to annulment in pursuance of a resolution of the House of Commons.

(5) But subsection (4) does not apply to a statutory instrument containing only
30regulations under section 78 (commencement).

78 Commencement and transitional provision

(1) This Part comes into force on such day as the Commissioners may by
regulations appoint.

(2) Regulations under subsection (1) may—

(a) 35appoint different days for different purposes;

(b) include transitional or transitory provision.

(3) Section 71(2) (reporting period) is subject to subsection (4).

(4) For the purposes of the application of this Part in relation to the scheme year
2019, the “reporting period”, in relation to a regulated installation, means—

(a) 40the period beginning with 1 April 2019 and ending with 31 December
2019, or

(b) such shorter period beginning on or after 1 April 2019 for which an
emissions report is required by a notice of surrender or a revocation
notice.

(5) For the purposes of the scheme year 2019, the provisions of the Emissions
Regulations, the Monitoring and Reporting Regulation and the Verification
Regulation apply, and anything done under those provisions has effect—

(a) as if, for the purposes of reporting or determining emissions from an
5installation, references to a period corresponding to a scheme year were
references to the reporting period for 2019 (and accordingly as if
references to a period beginning with 1 January were references to a
period beginning with 1 April 2019), and

(b) with such other modifications as are necessary for the purposes of the
10charge to carbon emissions tax for a reporting period beginning in 2019.

Part 4 Administration and enforcement

Time limits for assessments etc

79 Offshore matters or transfers: income tax and capital gains tax

(1) 15TMA 1970 is amended as follows.

36A Loss of tax involving offshore matter or offshore transfer

(1) This section applies in a case involving a loss of income tax or capital
gains tax, where—

(a) 20the lost tax involves an offshore matter, or

(b) the lost tax involves an offshore transfer which makes the lost
tax significantly harder to identify.

(2) An assessment on a person (“the taxpayer”) may be made at any time
not more than 12 years after the end of the year of assessment to which
25the lost tax relates.

This is subject to section 36(1A) above and any other provision of the
Taxes Acts allowing a longer period.

(3) Lost income tax or capital gains tax “involves an offshore matter” if it is
charged on or by reference to—

(a) 30income arising from a source in a territory outside the United
Kingdom,

(b) assets situated or held in a territory outside the United
Kingdom,

(c) income or assets received in a territory outside the United
35Kingdom,

(d) activities carried on wholly or mainly in a territory outside the
United Kingdom, or

(e) anything having effect as if it were income, assets or activities of
a kind described above.

(4) 40Lost income tax or capital gains tax “involves an offshore transfer” if—

(a) it does not involve an offshore matter, and

(b) the income or the proceeds of the disposal on or by reference to
which it is charged, or any part of the income or proceeds, is

transferred to a territory outside the United Kingdom before the
relevant date.

(5) In subsection (4)—

• “relevant date” means—

  (a)

  5in a case where the taxpayer (or a person acting on the
  taxpayer’s behalf) delivered a return under the Taxes
  Acts to HMRC for the year of assessment to which the
  lost tax relates and in which information relating to the
  lost tax was required to be provided, the date on which
  10the return was delivered, and

  (b)

  in any other case, 31 January in the year of assessment
  after that to which the lost tax relates;

• references to income or proceeds transferred include references to
  assets derived from or representing the income or proceeds.

(6) 15Where lost tax involves an offshore transfer, the cases in which the
transfer makes the lost tax significantly harder to identify include any
case where, because of the transfer—

(a) HMRC was significantly less likely to become aware of the lost
tax, or

(b) 20HMRC was likely to become aware of the lost tax only at a
significantly later time.

(7) But an assessment may not be made under subsection (2) if—

(a) before the time limit that would otherwise apply for making the
assessment, HMRC received relevant overseas information on
25the basis of which HMRC could reasonably have been expected
to become aware of the lost tax, and

(b) it was reasonable to expect the assessment to be made before
that time limit.

(8) In subsection (7)(a) “relevant overseas information” means information
30which is provided to HMRC by an authority in a territory outside the
United Kingdom under—

(a) any provision of EU law relating to any tax, or

(b) an agreement to which the United Kingdom and that territory
are parties, with or without other parties.

(9) 35An assessment may also not be made under subsection (2) to the extent
that liability to the lost tax arises as a result of an adjustment under Part
4 of TIOPA 2010 (transfer pricing adjustments).

(10) In this section “assets” has the meaning given in section 21(1) of the
1992 Act, but also includes sterling.

(11) 40Section 36(2) to (3A) applies for the purposes of this section (as if
references to section 36(1) or (1A) were to subsection (1) of this
section).”

(3) In section 37A (effect of assessment where allowances transferred), after “or
(1A)” insert “or 36A”.

(4) 45In section 40 (personal representatives), in subsection (1), for “or 36” substitute
“, 36 or 36A”.

(5) The amendments made by this section have effect—

(a) in relation to assessments on a person relating to the 2013-14 year of
assessment and subsequent years of assessment, where the loss of tax
is brought about carelessly by that person or by a person acting on that
person’s behalf, and

(b) 5in any other case, in relation to assessments relating to the 2015-16 year
of assessment and subsequent years of assessment.

80 Offshore matters or transfers: inheritance tax

(1) IHTA 1984 is amended as follows.

240B Underpayments involving offshore matters etc

(1) This section applies in a case within section 240(2) which involves a loss
of tax in relation to a chargeable transfer, where—

(a) 15the lost tax involves an offshore matter, or

(b) the lost tax involves an offshore transfer which makes the lost
tax significantly harder to identify.

(2) Proceedings for the recovery of the lost tax may be brought at any time
not more than 12 years after the later of the dates in section 240(2)(a)
20and (b).

(3) Lost tax “involves an offshore matter” if it is charged on or by reference
to property which is situated or held in a territory outside the United
Kingdom at, or immediately after, the time of the chargeable transfer.

(4) Lost tax “involves an offshore transfer” if—

(a) 25it does not involve an offshore matter, and

(b) the property is transferred to a territory outside the United
Kingdom at a relevant time.

(5) In subsection (4)(b) “relevant time” means a time after the chargeable
transfer but before—

(a) 30the date on which an account under section 216 is delivered to
HMRC in relation to the chargeable transfer, or

(b) any later date on which an account under section 217 is so
delivered.

(6) Where lost tax involves an offshore transfer, the cases in which the
35transfer makes the lost tax significantly harder to identify include any
case where, because of the transfer—

(a) HMRC was significantly less likely to become aware of the lost
tax, or

(b) HMRC was likely to become aware of the lost tax only at a
40significantly later time.

(7) But proceedings may not be brought under this section if—

(a) before the last date on which the proceedings could otherwise
be brought, HMRC received relevant overseas information on
the basis of which HMRC could reasonably have been expected
45to become aware of the lost tax, and

(b) it was reasonable to expect the proceedings to be brought before
that date.

(8)
In subsection (7)(a) “relevant overseas information” means information
which is provided to HMRC by an authority in a territory outside the
5United Kingdom under—

(a) any provision of EU law relating to any tax, or

(b) an agreement to which the United Kingdom and that territory
are parties, with or without other parties.

(9) This section is subject to any provision of this Act which allows for a
10longer period for the bringing of proceedings.”

(4) The amendments made by this section have effect—

(a) in a case involving loss of tax brought about carelessly by a person
liable for the tax (or a person acting on behalf of such a person), in
relation to chargeable transfers taking place on or after 1 April 2013,
15and

(b) in any other case, in relation to chargeable transfers taking place on or
after 1 April 2015.

(5) Section 240(8) of IHTA 1984 applies to the reference to “person liable for the
tax” in subsection (4)(a).

20Security deposits

81 Construction industry scheme and corporation tax etc

(1) In Chapter 3 of Part 3 of FA 2004 (construction industry scheme)—

(a) in the italic heading before section 69, after “returns” insert “, security”;

(b) after section 70 insert—

“70A 25Security for payments to HMRC

(1) The Commissioners for Her Majesty’s Revenue and Customs
may by regulations make provision for and in connection with
requiring the giving, by prescribed persons and in prescribed
circumstances, of security for the payment of amounts that a
30person is or may be liable to pay to the Commissioners under
this Chapter.

(2) Regulations under this section must provide that security may
be required only where an officer of Revenue and Customs
considers it necessary for the protection of the revenue.

(3) 35Regulations under this section must provide for a right of
appeal against—

(a) decisions to require security to be given;

(b) decisions as to the amount, terms or duration of any
security required.

(4) 40A person commits an offence if—

(a) the person fails to comply with a requirement to give
security that is imposed by regulations under this
section, and

(b) the failure continues for such period as is prescribed.

(5) A person who commits an offence under subsection (4) is liable
on summary conviction—

(a) in England and Wales, to a fine;

(b) in Scotland or Northern Ireland, to a fine not exceeding
5level 5 on the standard scale.

(6) In this section—

• “prescribed” means prescribed in regulations under this
  section;

• “security” includes further security.”

(2) 10In Schedule 18 to FA 1998 (company tax returns, assessments and related
matters), after paragraph 88 insert—

““Security for payments

88A (1) The Commissioners for Her Majesty’s Revenue and Customs may by
regulations make provision for and in connection with requiring the
15giving, by prescribed persons and in prescribed circumstances, of
security for the payment of tax that a company is or may be liable to
pay.

(2) Regulations under this paragraph must provide that security may be
required only where an officer of Revenue and Customs considers it
20necessary for the protection of the revenue.

(3) Regulations under this paragraph must provide for a right of appeal
against—

(a) decisions to require security to be given;

(b) decisions as to the amount, terms or duration of any security
25required.

(4) A person commits an offence if—

(a) the person fails to comply with a requirement to give security
that is imposed by regulations under this paragraph, and

(b) the failure continues for such period as is prescribed.

(5) 30A person who commits an offence under sub-paragraph (4) is liable
on summary conviction—

(a) in England and Wales, to a fine;

(b) in Scotland or Northern Ireland, to a fine not exceeding
level 5 on the standard scale.

(6) 35In this paragraph—

• “prescribed” means prescribed in regulations under this
  paragraph;

• “security” includes further security.”

(3) In section 684(4A) of ITEPA 2003 (failure to comply with requirement under
40PAYE regulations to give security), for “on summary conviction to a fine not
exceeding level 5 on the standard scale” substitute “on summary conviction—

(a) in England and Wales, to a fine;

(b) in Scotland or Northern Ireland, to a fine not exceeding level 5
on the standard scale”.

International agreements

82 Resolution of double taxation disputes

In Chapter 2 of Part 2 of TIOPA 2010 (double taxation relief: miscellaneous
provisions) after section 128 insert—

5““International dispute-resolution instruments and agreements

128A Power by regulations to give effect to international obligations etc

(1) The Treasury may make regulations for, or in connection with, giving
effect to or enabling effect to be given to—

(a) Council Directive (EU) 2017/1852 of 10 October 2017 on tax
10dispute resolution mechanisms in the European Union (“the
Directive”);

(b) any instrument modifying or supplementing the Directive;

(c) any international agreements or arrangements that deal with—

(i) matters dealt with by the Directive,

(ii) 15matters that are similar to any of those dealt with by the
Directive, or

(iii) any other matters that relate to or are connected with the
resolution of disputes in relation to double taxation
arrangements.

(2) 20The provision that may be made by regulations under this section
includes (in particular)—

(a) provision as to the effect of any arrangements that the
Commissioners for Her Majesty’s Revenue and Customs may
make with authorities of territories outside the United
25Kingdom;

(b) provision conferring or imposing functions, rights or
obligations, or authorising the conferral or imposition of
functions, rights or obligations, on a person (including a
commission, tribunal or court);

(c) 30provision under which the Commissioners or other persons
may exercise discretions;

(d) provision about procedure in relation to the resolution of
disputes;

(e) provision about costs, expenses and fees;

(f) 35provision imposing penalties or creating criminal offences;

(g) provision about appeals;

(h) provision about the form and manner in which, or time within
which, things are to be done;

(i) provision supplementing section 128B.

(3) 40The regulations may—

(a) make provision having effect in relation to periods before the
regulations come into force;

(b) make provision by reference to an instrument or document as it
has effect from time to time;

(c) 45make provision about things done, or to be done, in territories
outside the United Kingdom;

(d) make different provision for different purposes;

(e) make consequential, incidental, supplemental, transitional,
transitory or saving provision;

(f) make provision amending, repealing, revoking or disapplying,
5or modifying the effect of, any enactment (whenever passed or
made).

(4) The regulations may not create a criminal offence punishable on
indictment with imprisonment for more than two years.

(5) Regulations under this section containing anything that amends or
10repeals a provision of primary legislation may not be made unless a
draft of the regulations has been laid before, and approved by a
resolution of, the House of Commons.

In this subsection “primary legislation” means—

(a) an Act,

(b) 15an Act of the Scottish Parliament,

(c) a Measure or Act of the National Assembly for Wales, or

(d) Northern Ireland legislation.

(6) In subsections (2) and (3) and sections 128B and 128C, a reference to a
commission, tribunal, court or other person includes a reference to a
20commission, tribunal, court or other person in a territory outside the
United Kingdom.

128B Giving effect to requirements under section 128A regulations

(1) Subsection (2) applies if anything in regulations under section 128A
requires the Commissioners for Her Majesty’s Revenue and Customs to
25give effect to an agreement, decision or opinion made or given by—

(a) the Commissioners (or their authorised representative),

(b) the competent authority of a territory outside the United
Kingdom, or

(c) any commission, tribunal, court or other person.

(2) 30The Commissioners are to give effect to the agreement, decision or
opinion despite anything in any enactment, and any such adjustment
as is appropriate in consequence may be made.

(3) An adjustment under subsection (2) may be made by way of discharge
or repayment of tax, the allowance of credit against tax payable in the
35United Kingdom, the making of an assessment or otherwise.

128C Disclosure under international obligations etc

(1) The obligation as to secrecy imposed by any enactment does not
prevent—

(a) the Commissioners for Her Majesty’s Revenue and Customs,

(b) 40a person who is or was an authorised Revenue and Customs
official,

(c) a person who is or was a member of a committee or other body
established by the Commissioners for Her Majesty’s Revenue
and Customs (or jointly by the Commissioners and an authority
45of a territory outside the United Kingdom), or

(d) a person specified, or of a description specified, in regulations
made by the Treasury,

from disclosing information required to be disclosed under a relevant
instrument or agreement in pursuance of a request made by any
person.

(2) In this section—

• 5“relevant instrument or agreement” means an instrument,
  agreement or arrangement referred to, or of a kind referred to,
  in section 128A(1);

• “Revenue and Customs official” means—

  (a)

  a Commissioner for Her Majesty’s Revenue and
  10Customs;

  (b)

  an officer of Revenue and Customs;

  (c)

  a person acting on behalf of the Commissioners for Her
  Majesty’s Revenue and Customs;

  (d)

  a person acting on behalf of an officer of Revenue and
  15Customs.”

83 International tax enforcement: disclosable arrangements

(1) The Treasury may, for the purpose of securing compliance with an obligation
of the government of the United Kingdom under an international tax
provision, make regulations requiring persons who participate in
20arrangements of a description specified in the regulations to disclose
information about those arrangements.

(2) Regulations under this section may—

(a) require information to be disclosed in such form and manner, and at
such intervals, as may be specified in the regulations;

(b) 25require persons to disclose information about arrangements that they
participated in before (as well as after) the coming into force of this
section;

(c) provide for the imposition of penalties in respect of a contravention of,
or non-compliance with, a requirement of the regulations, including
30provision about appeals in relation to the imposition of a penalty;

(d) make different provision for different purposes.

(3) For the purposes of subsections (1) and (2)—

• “arrangements” includes any scheme, transaction or series of transactions;

• “participate”, in relation to arrangements, includes being involved in, or
  35facilitating, the arrangements in any way (for example, by receiving
  any benefit from them or by designing, marketing or providing services
  in connection with them, or arranging for others to do so);

• “international tax provision” means any provision of—

  (a)

  any arrangements specified in an Order in Council made under
  40section 173 of FA 2006 (international tax enforcement
  arrangements), or

  (b)

  Council Directive 2011/16/EU of 15 February 2011 on
  administrative cooperation in the field of taxation and repealing
  Directive 77/799/EEC, as amended from time to time.

(4) 45Regulations under this section may make consequential, supplementary,
incidental, transitional or saving provision (and may do so by amending,
repealing or revoking an enactment whenever passed or made).