|
| |
|
| |
| |
Disclosure of tax avoidance schemes |
| |
Amendments of Part 7 of FA 2004 |
| |
1 | Part 7 of FA 2004 (disclosure of tax avoidance schemes) is amended as |
| |
| 5 |
2 (1) | Section 308 (duties of promoter) is amended as follows. |
| |
| |
(a) | for “The promoter” substitute “A person who is a promoter in |
| |
relation to a notifiable proposal”, and |
| |
(b) | for “any” substitute “the”. |
| 10 |
(3) | In subsection (2)(a), for “a” substitute “the”. |
| |
| |
(a) | for “The promoter” substitute “A person who is a promoter in |
| |
relation to notifiable arrangements”, and |
| |
(b) | for “any notifiable” substitute “the notifiable”. |
| 15 |
(5) | For subsection (4) substitute— |
| |
“(4) | Subsection (4A) applies where a person complies with subsection (1) |
| |
in relation to a notifiable proposal for arrangements and another |
| |
| |
(a) | also a promoter in relation to the notifiable proposal or is a |
| 20 |
promoter in relation to a notifiable proposal for |
| |
arrangements which are substantially the same as the |
| |
proposed arrangements (whether they relate to the same or |
| |
| |
(b) | a promoter in relation to notifiable arrangements |
| 25 |
implementing the notifiable proposal or notifiable |
| |
arrangements which are substantially the same as notifiable |
| |
arrangements implementing the notifiable proposal |
| |
(whether they relate to the same or different parties). |
| |
(4A) | Any duty of the other person under subsection (1) or (3) in relation |
| 30 |
to the notifiable proposal or notifiable arrangements is discharged |
| |
| |
(a) | the person who complied with subsection (1) has notified the |
| |
identity and address of the other person to HMRC or the |
| |
other person holds the reference number allocated to the |
| 35 |
proposed notifiable arrangements under section 311, and |
| |
(b) | the other person holds the information provided to HMRC in |
| |
compliance with subsection (1). |
| |
(4B) | Subsection (4C) applies where a person complies with subsection (3) |
| |
in relation to notifiable arrangements and another person is— |
| 40 |
(a) | a promoter in relation to a notifiable proposal for |
| |
arrangements which are substantially the same as the |
| |
notifiable arrangements (whether they relate to the same or |
| |
| |
|
| |
|
| |
|
(b) | also a promoter in relation to the notifiable arrangements or |
| |
notifiable arrangements which are substantially the same |
| |
(whether they relate to the same or different parties). |
| |
(4C) | Any duty of the other person under subsection (1) or (3) in relation |
| |
to the notifiable proposal or notifiable arrangements is discharged |
| 5 |
| |
(a) | the person who complied with subsection (3) has notified the |
| |
identity and address of the other person to HMRC or the |
| |
other person holds the reference number allocated to the |
| |
notifiable arrangements under section 311, and |
| 10 |
(b) | the other person holds the information provided to HMRC in |
| |
compliance with subsection (3).” |
| |
3 | In section 311(1) (arrangements to be given reference number)— |
| |
(a) | after “complies” insert “or purports to comply”, |
| |
(b) | omit “may within 30 days”, |
| 15 |
(c) | before “allocate” insert “may within 30 days”, and |
| |
(d) | for “notify the person of that number” substitute “must notify that |
| |
number to the person and (where the person is one who has |
| |
complied or purported to comply with section 308(1) or (3)) to any |
| |
| 20 |
(i) | who is a promoter in relation to the notifiable |
| |
proposal (or arrangements implementing the |
| |
notifiable proposal) or the notifiable |
| |
arrangements (or proposal implemented by |
| |
the notifiable arrangements), and |
| 25 |
(ii) | whose identity and address has been notified |
| |
| |
4 | For section 312 substitute— |
| |
“312 | Duty of promoter to notify client of number |
| |
(1) | This section applies where a person who is a promoter in relation to |
| 30 |
notifiable arrangements is providing (or has provided) services to |
| |
any person (“the client”) in connection with the notifiable |
| |
| |
(2) | The promoter must, within 30 days after the relevant date, provide |
| |
the client with prescribed information relating to any reference |
| 35 |
number (or, if more than one, any one reference number) that has |
| |
been notified to the promoter (whether by HMRC or any other |
| |
| |
(a) | the notifiable arrangements, or |
| |
(b) | any arrangements substantially the same as the notifiable |
| 40 |
arrangements (whether involving the same or different |
| |
| |
(3) | In subsection (2) “the relevant date” means the later of— |
| |
(a) | the date on which the promoter becomes aware of any |
| |
transaction involving the client which forms part of the |
| 45 |
notifiable arrangements, and |
| |
(b) | the date on which the reference number is notified to the |
| |
| |
|
| |
|
| |
|
(4) | But where the conditions in subsection (5) are met the duty imposed |
| |
on the promoter under subsection (2) to provide the client with |
| |
information in relation to notifiable arrangements is discharged. |
| |
(5) | Those conditions are— |
| |
(a) | that the promoter is also a promoter in relation to a notifiable |
| 5 |
proposal and provides services to the client in connection |
| |
| |
(b) | the notifiable proposal and the notifiable arrangements are |
| |
substantially the same, and |
| |
(c) | the promoter has provided to the client, in a form and |
| 10 |
manner specified by HMRC, prescribed information relating |
| |
to the reference number that has been notified to the |
| |
promoter in relation to the proposed notifiable |
| |
| |
(6) | HMRC may give notice that, in relation to notifiable arrangements |
| 15 |
specified in the notice, promoters are not under the duty under |
| |
subsection (2) after the date specified in the notice. |
| |
312A | Duty of client to notify parties of number |
| |
(1) | This section applies where a person (a “client”) to whom a person |
| |
who is a promoter in relation to notifiable arrangements or a |
| 20 |
notifiable proposal is providing (or has provided) services in |
| |
connection with the notifiable arrangements or notifiable proposal |
| |
receives prescribed information relating to the reference number |
| |
allocated to the notifiable arrangements or proposed notifiable |
| |
| 25 |
(2) | The client must, within the prescribed period, provide prescribed |
| |
information relating to the reference number to any other person— |
| |
(a) | who the client might reasonably be expected to know is or is |
| |
likely to be a party to the arrangements or proposed |
| |
| 30 |
(b) | who might reasonably be expected to gain a tax advantage in |
| |
relation to any relevant tax by reason of the arrangements or |
| |
| |
(3) | For the purposes of subsection (1) a tax is a “relevant tax” in relation |
| |
to arrangements or arrangements proposed in a proposal of any |
| 35 |
description if it is prescribed in relation to arrangements or proposals |
| |
of that description by regulations under section 306. |
| |
(4) | HMRC may give notice that, in relation to notifiable arrangements or |
| |
a notifiable proposal specified in the notice, persons are not under |
| |
the duty under subsection (2) after the date specified in the notice. |
| 40 |
(5) | The duty under subsection (2) does not apply in prescribed |
| |
| |
5 (1) | Section 313 (duty of parties to notifiable arrangements to notify HMRC of |
| |
number etc) is amended as follows. |
| |
(2) | In subsection (1)(a), omit “under section 311 by the Board or under section |
| 45 |
| |
| |
|
| |
|
| |
|
(a) | for “under subsection (1)” substitute “made by HMRC”, |
| |
(b) | in paragraph (a), for “number and other information” substitute |
| |
“information prescribed under subsection (1)”, and |
| |
(c) | in paragraph (b), for “number and other information” substitute |
| |
“information prescribed under subsection (1) and such other |
| 5 |
information as is prescribed”. |
| |
| |
“(5) | HMRC may give notice that, in relation to notifiable arrangements |
| |
specified in the notice, persons are not under the duty under |
| |
subsection (1) after the date specified in the notice.” |
| 10 |
6 | For section 316 substitute— |
| |
“316 | Information to be provided in form and manner specified by HMRC |
| |
(1) | HMRC may specify the form and manner in which information |
| |
required to be provided by any of the information provisions must |
| |
be provided if the provision is to be complied with. |
| 15 |
(2) | The “information provisions” are sections 308(1) and (3), 309(1), 310, |
| |
312(2), 312A(2) and 313(1) and (3).” |
| |
| |
7 (1) | Section 98C of TMA 1970 (penalties for failure to comply with duties under |
| |
Part 7 of FA 2004) is amended as follows. |
| 20 |
| |
(a) | in paragraph (d), for “312(1)” substitute “312(2)”, and |
| |
(b) | after that paragraph (but before the “and”) insert— |
| |
“(da) | section 312A(2) (duty of client to notify parties of |
| |
| 25 |
| |
(a) | for “section 313(1)” substitute “subsection (1) of section 313”, and |
| |
(b) | after “etc.)” insert “or regulations under subsection (3) of that |
| |
| |
(4) | In subsection (4), for “313(1)” (in both places) substitute “subsection (1) of |
| 30 |
section 313 or regulations under subsection (3) of that section”. |
| |
| |
| |
Time limits for assessments, claims etc. |
| |
| |
1 | TMA 1970 is amended as follows. |
| 35 |
2 | In section 28C(5)(a) (time limit for determination of tax where no return |
| |
delivered and self-assessment superseding determination), for “five years” |
| |
| |
|
| |
|
| |
|
3 | In section 29(4) (assessment where loss of tax discovered), for “is attributable |
| |
to fraudulent or negligent conduct on the part of” substitute “was brought |
| |
about carelessly or deliberately by”. |
| |
4 | In section 30B(5) (amendment of partnership statement where loss of tax |
| |
discovered), for “is attributable to fraudulent or negligent conduct on the |
| 5 |
part of” substitute “was brought about carelessly or deliberately by”. |
| |
5 | In section 33(1) (claim for error or mistake), for “not later than five years after |
| |
the 31st January next following” substitute “not more than 4 years after the |
| |
| |
6 | In section 33A(2) (error or mistake in partnership return), for “not later than |
| 10 |
31st January of Year 6” substitute “not more than 4 years after the end of the |
| |
year of assessment in question, or in which the relevant period ends,”. |
| |
7 (1) | Section 34 (ordinary time limit for assessments) is amended as follows. |
| |
(2) | In subsection (1), for “not later than five years after the 31st January next |
| |
following” substitute “not more than 4 years after the end of”. |
| 15 |
(3) | Accordingly, in the heading, for “six years” substitute “4 years”. |
| |
8 | In section 35 (time limit: income received after year for which it is |
| |
assessable), for “within six years after” substitute “not more than 4 years |
| |
| |
9 (1) | Section 36 (fraudulent or negligent conduct) is amended as follows. |
| 20 |
(2) | For subsection (1) substitute— |
| |
“(1) | An assessment on a person in a case involving a loss of income tax or |
| |
capital gains tax brought about carelessly by the person may be |
| |
made at any time not more than 6 years after the end of the year of |
| |
assessment to which it relates (subject to subsection (1A) and any |
| 25 |
other provision of the Taxes Acts allowing a longer period). |
| |
(1A) | An assessment on a person in a case involving a loss of income tax or |
| |
| |
(a) | brought about deliberately by the person, |
| |
(b) | attributable to a failure by the person to comply with an |
| 30 |
obligation under section 7, or |
| |
(c) | attributable to arrangements in respect of which the person |
| |
has failed to comply with an obligation under section 309, 310 |
| |
or 313 of the Finance Act 2004 (obligation of parties to tax |
| |
avoidance schemes to provide information to Her Majesty’s |
| 35 |
| |
| may be made at any time not more than 20 years after the end of the |
| |
year of assessment to which it relates (subject to any provision of the |
| |
Taxes Acts allowing a longer period). |
| |
(1B) | In subsections (1) and (1A), references to a loss brought about by the |
| 40 |
person who is the subject of the assessment include a loss brought |
| |
about by another person acting on behalf of that person.” |
| |
| |
(a) | for “Where the person in default” substitute “Where the person |
| |
mentioned in subsection (1) or (1A) (“the person in default”)”, and |
| 45 |
|
| |
|
| |
|
(b) | for “subsection (1) above” substitute “subsection (1A) or (1B)”. |
| |
(4) | In subsection (3), after “(1)” insert “or (1A)”. |
| |
(5) | In subsection (4), for “subsection (1)” substitute “subsections (1) and (1A)”. |
| |
(6) | Accordingly, for the heading substitute “Loss of tax brought about |
| |
carelessly or deliberately etc”. |
| 5 |
10 | In section 37A (effect of assessment where allowances transferred), for the |
| |
words from “for the purpose” to “conduct” substitute “in a case falling |
| |
within section 36(1) or (1A)”. |
| |
11 (1) | Section 40 (assessment on personal representatives) is amended as follows. |
| |
(2) | In subsection (1) for “beyond the end of the period of three years beginning |
| 10 |
with the 31st January next following” substitute “more than 4 years after the |
| |
| |
| |
(a) | for the words from the beginning to “died” substitute “In a case |
| |
involving a loss of tax brought about carelessly or deliberately by a |
| 15 |
person who has died (or another person acting on that person’s |
| |
behalf before that person’s death)”, and |
| |
(b) | for “before the end of the period of three years beginning with the |
| |
31st January next following” substitute “not more than 4 years after |
| |
| 20 |
12 | In section 43(1) (time limit for making claims), for “five years after the 31st |
| |
January next following” substitute “4 years after the end of”. |
| |
13 | In section 43A(1)(b) (further assessments: claims etc), for the words from |
| |
“attributable” to the end substitute “brought about carelessly or deliberately |
| |
by that person or by someone acting on behalf of that person.” |
| 25 |
14 | In section 43C(1)(b) (consequential claims etc), for “attributable to |
| |
fraudulent or negligent conduct on the part of” substitute “brought about |
| |
carelessly or deliberately by”. |
| |
15 | In section 118 (interpretation), insert at the end— |
| |
“(5) | For the purposes of this Act a loss of tax or a situation is brought |
| 30 |
about carelessly by a person if the person fails to take reasonable care |
| |
to avoid bringing about that loss or situation. |
| |
| |
(a) | information is provided to Her Majesty’s Revenue and |
| |
| 35 |
(b) | the person who provided the information, or the person on |
| |
whose behalf the information was provided, discovers some |
| |
time later that the information was inaccurate, and |
| |
(c) | that person fails to take reasonable steps to inform Her |
| |
Majesty’s Revenue and Customs, |
| 40 |
| any loss of tax or situation brought about by the inaccuracy shall be |
| |
treated for the purposes of this Act as having been brought about |
| |
carelessly by that person. |
| |
(7) | In this Act, references to a loss of tax or a situation brought about |
| |
deliberately by a person include a loss of tax or a situation that arises |
| 45 |
|
| |
|
| |
|
as a result of a deliberate inaccuracy in a document given to Her |
| |
Majesty’s Revenue and Customs by or on behalf of that person.” |
| |
| |
16 | ICTA is amended as follows. |
| |
17 | In section 36(2)(b) (claims for repayment of tax on sale of land with right to |
| 5 |
reconveyance), for “six years” substitute “4 years”. |
| |
18 | In section 257AB(9) (elections in respect of married couple’s allowance |
| |
(post-5th December 2005 marriages and civil partnerships)), for “on or |
| |
before the 5th anniversary of the 31st January next following” substitute “not |
| |
more than 4 years after”. |
| 10 |
19 | In section 257BB(5)(a) (notices in respect of transfer of relief under section |
| |
257A or 257AB), for “on or before the fifth anniversary of the 31st January |
| |
next following” substitute “not more than 4 years after”. |
| |
20 | In section 265(5) (notices in respect of transfer of blind person’s allowance), |
| |
for “on or before the fifth anniversary of the 31st January next following” |
| 15 |
substitute “not more than 4 years after”. |
| |
21 | In section 270(4) (claims for repayment of excess paid on surrender etc of life |
| |
insurance policy), for “six years” substitute “4 years”. |
| |
22 | In section 419(4) (claims for relief from tax where loan surrendered etc), for |
| |
“six years” substitute “4 years”. |
| 20 |
23 | In section 500(4) (additional assessment to corporation tax where petroleum |
| |
revenue tax repaid), for “six years” substitute “4 years”. |
| |
24 | In section 806(1) (time limit for claims for allowance under arrangements by |
| |
way of credit for foreign tax) is amended as follows— |
| |
(a) | in paragraph (a)(i), for “the fifth anniversary of the 31st January next |
| 25 |
following” substitute “the 4th anniversary of the end of”, and |
| |
(b) | in paragraph (b)(i), for “six years” substitute “4 years”. |
| |
25 | In section 806G(3)(a) (claims for the purposes of utilisation of eligible |
| |
unrelieved foreign tax), for “six years” substitute “4 years”. |
| |
26 | In section 806M(7)(a) (claims for the purpose of carry forward or carry back |
| 30 |
of unrelieved foreign tax), for “six years” substitute “4 years”. |
| |
| |
27 | TCGA 1992 is amended as follows. |
| |
28 | In section 203(2) (claims in respect of certain capital losses), for “6 years” |
| |
| 35 |
29 | In section 253(4A) (claims for relief for loans to traders)— |
| |
(a) | in paragraph (a), for “on or before the fifth anniversary of the 31st |
| |
January next following” substitute “not more than 4 years after the |
| |
| |
(b) | in paragraph (b), for “6 years” substitute “4 years”. |
| 40 |
30 | In section 279(5) (claims in respect of delayed remittance of gain from |
| |
disposal of foreign assets)— |
| |
|
| |
|