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Finance Bill
Schedule 36 — Information and inspection powers
Part 1 — Powers to obtain information and documents

351

 

Schedule 36

Section 108

 

Information and inspection powers

Part 1

Powers to obtain information and documents

Power to obtain information and documents from taxpayer

5

1     (1)  

An officer of Revenue and Customs may by notice in writing require a

person (“the taxpayer”)—

(a)   

to provide information, or

(b)   

to produce a document,

           

if the information or document is reasonably required by the officer for the

10

purpose of checking the taxpayer’s tax position.

      (2)  

In this Schedule, “taxpayer notice” means a notice under this paragraph.

Power to obtain information and documents from third party

2     (1)  

An officer of Revenue and Customs may by notice in writing require a

person—

15

(a)   

to provide information, or

(b)   

to produce a document,

           

if the information or document is reasonably required by the officer for the

purpose of checking the tax position of another person whose identity is

known to the officer (“the taxpayer”).

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      (2)  

A third party notice must name the taxpayer to whom it relates, unless the

First-tier Tribunal has approved the giving of the notice and disapplied this

requirement under paragraph 3.

      (3)  

In this Schedule, “third party notice” means a notice under this paragraph.

Approval etc of taxpayer notices and third party notices

25

3     (1)  

An officer of Revenue and Customs may not give a third party notice

without—

(a)   

the agreement of the taxpayer, or

(b)   

the approval of the First-tier Tribunal.

      (2)  

An officer of Revenue and Customs may ask for the approval of the First-tier

30

Tribunal to the giving of any taxpayer notice or third party notice (and for

the effect of obtaining such approval see paragraphs 27, 28 and 51 (appeals

against notices and offence)).

      (3)  

The First-tier Tribunal may not approve the giving of a taxpayer notice or

third party notice unless—

35

(a)   

an application for approval is made by, or with the agreement of, an

authorised officer of Revenue and Customs,

(b)   

the Tribunal is satisfied that, in the circumstances, the officer giving

the notice is justified in doing so,

(c)   

the person to whom the notice is addressed has been told that the

40

information or documents referred to in the notice are required and

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 1 — Powers to obtain information and documents

352

 

given a reasonable opportunity to make representations to an officer

of Revenue and Customs,

(d)   

the First-tier Tribunal has been given a summary of any

representations made by that person, and

(e)   

in the case of a third party notice, the taxpayer has been given a

5

summary of the reasons why an officer of Revenue and Customs

requires the information and documents.

      (4)  

Paragraphs (c) to (e) of sub-paragraph (3) do not apply to the extent that the

First-tier Tribunal is satisfied that taking the action specified in those

paragraphs might prejudice the assessment or collection of tax.

10

      (5)  

Where the First-tier Tribunal approves the giving of a third party notice

under this paragraph, it may also disapply the requirement to name the

taxpayer in the notice if it is satisfied that the officer has reasonable grounds

for believing that naming the taxpayer might seriously prejudice the

assessment or collection of tax.

15

Copying third party notice to taxpayer

4     (1)  

An officer of Revenue and Customs who gives a third party notice must give

a copy of the notice to the taxpayer to whom it relates, unless the First-tier

Tribunal has disapplied this requirement.

      (2)  

The First-tier Tribunal may not disapply that requirement unless—

20

(a)   

an application for approval is made by, or with the agreement of, an

authorised officer of Revenue and Customs, and

(b)   

the Tribunal is satisfied that the officer has reasonable grounds for

believing that giving a copy of the notice to the taxpayer might

prejudice the assessment or collection of tax.

25

Power to obtain information and documents about persons whose identity is not known

5     (1)  

An authorised officer of Revenue and Customs may by notice in writing

require a person—

(a)   

to provide information, or

(b)   

to produce a document,

30

           

if the condition in sub-paragraph (2) is met.

      (2)  

That condition is that the information or document is reasonably required by

the officer for the purpose of checking the UK tax position of—

(a)   

a person whose identity is not known to the officer, or

(b)   

a class of persons whose individual identities are not known to the

35

officer.

      (3)  

An officer of Revenue and Customs may not give a notice under this

paragraph without the approval of the First-tier Tribunal.

      (4)  

The First-tier Tribunal may not give its approval for the purpose of this

paragraph unless it is satisfied that—

40

(a)   

the notice would meet the condition in sub-paragraph (2),

(b)   

there are reasonable grounds for believing that the person or any of

the class of persons to whom the notice relates may have failed or

may fail to comply with any provision of the Taxes Acts, VATA 1994

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 1 — Powers to obtain information and documents

353

 

or any other enactment relating to value added tax charged in

accordance with that Act,

(c)   

any such failure is likely to have led or to lead to serious prejudice to

the assessment or collection of UK tax, and

(d)   

the information or document to which the notice relates is not readily

5

available from another source.

      (5)  

In this paragraph “UK tax” means any tax other than relevant foreign tax

and value added tax charged in accordance with the law of another member

State.

Notices

10

6     (1)  

In this Schedule, “information notice” means a notice under paragraph 1, 2

or 5.

      (2)  

An information notice may specify or describe the information or

documents to be provided or produced.

      (3)  

If an information notice is given with the approval of the First-tier Tribunal,

15

it must state that it is given with that approval.

Complying with notices

7     (1)  

Where a person is required by an information notice to provide information

or produce a document, the person must do so—

(a)   

within such period, and

20

(b)   

at such time, by such means and in such form (if any),

           

as is reasonably specified or described in the notice.

      (2)  

Where an information notice requires a person to produce a document, it

must be produced for inspection—

(a)   

at a place agreed to by that person and an officer of Revenue and

25

Customs, or

(b)   

at such place as an officer of Revenue and Customs may reasonably

specify.

      (3)  

An officer of Revenue and Customs must not specify a place that is used

solely as a dwelling.

30

      (4)  

The production of a document in compliance with an information notice is

not to be regarded as breaking any lien claimed on the document.

Producing copies of documents

8     (1)  

Where an information notice requires a person to produce a document, the

person may comply with the notice by producing a copy of the document,

35

subject to any conditions or exceptions set out in regulations made by the

Commissioners.

      (2)  

Sub-paragraph (1) does not apply where—

(a)   

the notice requires the person to produce the original document, or

(b)   

an officer of Revenue and Customs subsequently makes a request in

40

writing to the person for the original document.

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 2 — Powers to inspect businesses etc

354

 

      (3)  

Where an officer of Revenue and Customs requests a document under sub-

paragraph (2)(b), the person to whom the request is made must produce the

document—

(a)   

within such period, and

(b)   

at such time and by such means (if any),

5

           

as is reasonably requested by the officer.

Restrictions and special cases

9          

This Part of this Schedule has effect subject to Parts 4 and 6 of this Schedule.

Part 2

Powers to inspect businesses etc

10

Power to inspect business premises etc

10    (1)  

An officer of Revenue and Customs may enter any business premises and

inspect—

(a)   

the premises,

(b)   

business assets that are on the premises, and

15

(c)   

business documents that are on the premises,

           

if the inspection is reasonably required for the purpose of checking the tax

position of any person.

      (2)  

An inspection under this paragraph may be carried out at any reasonable

time, subject to sub-paragraph (3).

20

      (3)  

An inspection may not be carried out unless—

(a)   

the occupier of the premises has been given at least 24 hours’ notice

(whether in writing or otherwise), or

(b)   

the inspection is carried out by, or with the agreement of, an

authorised officer of Revenue and Customs.

25

      (4)  

An officer of Revenue and Customs seeking to carry out an inspection under

sub-paragraph (3)(b) must provide a notice in writing as follows—

(a)   

if the occupier of the premises is present at the time the inspection is

to begin, the notice must be provided to the occupier,

(b)   

if the occupier of the premises is not present but a person who

30

appears to the officer to be in charge of the premises is present, the

notice must be provided to that person, and

(c)   

in any other case, the notice must be left in a prominent place on the

premises.

      (5)  

The notice referred to in sub-paragraph (4) must state the possible

35

consequences of obstructing the officer in the exercise of the power.

      (6)  

If a notice referred to in sub-paragraph (4) is given with the approval of the

First-tier Tribunal (see paragraph 11), it must state that it is given with that

approval.

      (7)  

In this Schedule—

40

“business assets” means assets that an officer of Revenue and Customs

has reason to believe are owned, leased or used in connection with

the carrying on of any business, excluding documents,

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 3 — Further powers

355

 

“business documents” means documents (or copies of documents)—

(a)   

that relate to the carrying on of any business, and

(b)   

that form part of any person’s statutory records,

“business premises” means premises (or any part of premises) that an

officer of Revenue and Customs has reason to believe are (or is) used

5

in connection with the carrying on of a business, and

“premises” includes—

(a)   

any building or structure,

(b)   

any land, and

(c)   

any means of transport.

10

Approval of First-tier Tribunal

11    (1)  

An officer of Revenue and Customs may ask the First-tier Tribunal to

approve an inspection under this Part of this Schedule.

      (2)  

The First-tier Tribunal may not approve an inspection unless—

(a)   

an application for approval is made by, or with the agreement of, an

15

authorised officer of Revenue and Customs, and

(b)   

the Tribunal is satisfied that, in the circumstances, the inspection is

justified.

Restrictions and special cases

12         

This Part of this Schedule has effect subject to Parts 4 and 6 of this Schedule.

20

Part 3

Further powers

Power to copy documents

13         

Where a document (or a copy of a document) is produced to, or inspected

by, an officer of Revenue and Customs, such an officer may take copies of,

25

or make extracts from, the document.

Power to remove documents

14    (1)  

Where a document is produced to, or inspected by, an officer of Revenue

and Customs, such an officer may—

(a)   

remove the document at a reasonable time, and

30

(b)   

retain it for a reasonable period,

           

if it appears to the officer to be necessary to do so.

      (2)  

Where a document is removed in accordance with sub-paragraph (1), the

person who produced the document may request—

(a)   

a receipt for the document, and

35

(b)   

if the document is reasonably required for any purpose, a copy of the

document,

           

and an officer of Revenue and Customs must comply with such a request

without charge.

      (3)  

The removal of a document under this paragraph is not to be regarded as

40

breaking any lien claimed on the document.

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 4 — Restrictions on powers

356

 

      (4)  

Where a document removed under this paragraph is lost or damaged, the

Commissioners are liable to compensate the owner of the document for any

expenses reasonably incurred in replacing or repairing the document.

      (5)  

In this paragraph, references to a document include a copy of a document.

Power to mark assets and to record information

5

15         

The powers under Part 2 of this Schedule include—

(a)   

power to mark business assets, and anything containing business

assets, for the purpose of indicating that they have been inspected,

and

(b)   

power to obtain and record information (whether electronically or

10

otherwise) relating to the premises, assets and documents that have

been inspected.

Part 4

Restrictions on powers

Documents not in person’s possession or power

15

16         

An information notice only requires a person to produce a document it if is

in the person’s possession or power.

Types of information

17    (1)  

An information notice does not require a person to provide or produce—

(a)   

information that relates to the conduct of a pending appeal relating

20

to tax or any part of a document containing such information, or

(b)   

journalistic material (as defined in section 13 of the Police and

Criminal Evidence Act 1984 (c. 60)) or information contained in such

material.

      (2)  

An information notice does not require a person to provide or produce

25

personal records (as defined in section 12 of the Police and Criminal

Evidence Act 1984) or information contained in such records, subject to sub-

paragraph (3).

      (3)  

An information notice may require a person—

(a)   

to produce documents, or copies of documents, that are personal

30

records, omitting any information whose inclusion (whether alone or

with other information) makes the original documents personal

records (“personal information”), and

(b)   

to provide any information contained in such records that is not

personal information.

35

Old documents

18         

An information notice may not require a person to produce a document if

the whole of the document originates more than 6 years before the date of

the notice, unless the notice is given by, or with the agreement of, an

authorised officer.

40

 
 

Finance Bill
Schedule 36 — Information and inspection powers
Part 4 — Restrictions on powers

357

 

Taxpayer notices

19    (1)  

Where a person has made a tax return in respect of a chargeable period

under section 8, 8A or 12AA of TMA 1970 (returns for purpose of income tax

and capital gains tax), a taxpayer notice may not be given for the purpose of

checking that person’s income tax position or capital gains tax position in

5

relation to the chargeable period.

      (2)  

Where a person has made a tax return in respect of a chargeable period

under paragraph 3 of Schedule 18 to FA 1998 (company tax returns), a

taxpayer notice may not be given for the purpose of checking that person’s

corporation tax position

10

      (3)  

Sub-paragraphs (1) and (2) do not apply where, or to the extent that, any of

conditions A to D are met.

      (4)  

Condition A is that a notice of enquiry has been given in respect of—

(a)   

the return, or

(b)   

a claim or election (or an amendment of a claim or election) made by

15

the person in relation to the chargeable period in respect of the tax (or

one of the taxes) to which the return relates (“relevant tax”),

           

and the enquiry has not been completed.

      (5)  

In sub-paragraph (4), “notice of enquiry” means a notice under—

(a)   

section 9A or 12AC of, or paragraph 5 of Schedule 1A to, TMA 1970,

20

or

(b)   

paragraph 24 of Schedule 18 to FA 1998.

      (6)  

Condition B is that an officer of Revenue and Customs has reason to suspect

that—

(a)   

an amount that ought to have been assessed to relevant tax for the

25

chargeable period may not have been assessed,

(b)   

an assessment to relevant tax for the chargeable period may be or

have become insufficient, or

(c)   

relief from relevant tax given for the chargeable period may be or

have become excessive.

30

      (7)  

Condition C is that the notice is given for the purpose of obtaining any

information or document that is also required for the purpose of checking

that person’s VAT position.

      (8)  

Condition D is that the notice is given for the purpose of obtaining any

information or document that is required (or also required) for the purpose

35

of checking the person’s position as regards any deductions or repayments

referred to in paragraph 62(2) (PAYE etc).

Deceased persons

20         

An information notice given for the purpose of checking the tax position of

a person who has died may not be given more than 6 years after the person’s

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death.

Privileged communications between professional legal advisers and clients

21    (1)  

An information notice does not require a person—

(a)   

to provide privileged information, or

 
 

 
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