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Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

338

 

      (2)  

Omit paragraphs 9 and 10 of Schedule 3 (election to have amounts

mentioned in section 2(9)(b) and (c) spread).

      (3)  

In consequence of the omission of paragraph 9 of Schedule 3, omit section

9(4).

      (4)  

Omit paragraph 3 of Schedule 4 (allowable expenditure incurred before 13

5

November 1974).

      (5)  

The repeals made by this paragraph have effect in relation to chargeable

periods beginning after 30 June 2009.

OTA 1983

2     (1)  

OTA 1983 is amended as follows.

10

      (2)  

Omit section 9(3) and paragraph 3 of Schedule 3 (receipts from contracts

made before 8 May 1982).

      (3)  

In consequence of the omission of subsection (3) of section 9—

(a)   

in subsection (2) of that section, for “subsections (3) and (4)”

substitute “subsection (4)”, and

15

(b)   

in subsection (4)(b) of that section, for “subsections (1) to (3)”

substitute “subsections (1) and (2)”.

      (4)  

Omit sections 13 and 14 and Schedule 5 (transitional provision for

expenditure incurred on or before 31 December 1983).

FA 1993

20

3     (1)  

Schedule 20A to FA 1993 (as inserted by Part 1 of Schedule 33 to FA 2008) is

renumbered as Schedule 20B to that Act.

      (2)  

In the following provisions, for “Schedule 20A” substitute “Schedule 20B”—

(a)   

section 6(1A) of OTA 1975,

(b)   

paragraph 15(9A) of Schedule 17 to FA 1980, and

25

(c)   

section 185(1ZA)(b) of FA 1993.

ICTA

4     (1)  

In section 502(3A) of ICTA (interpretation of Chapter 5 of Part 12), omit the

words from “but” to the end.

      (2)  

The repeal made by this paragraph has effect on and after 22 April 2009.

30

Schedule 46

Section 92

 

Duties of senior accounting officers of large companies

Main duty of senior accounting officer

1     (1)  

The senior accounting officer of a large company must take reasonable steps

to ensure that the company and each of its subsidiaries (if any) establishes

35

and maintains appropriate tax accounting arrangements.

 
 

Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

339

 

      (2)  

The senior accounting officer of a large company must, in particular, take

reasonable steps—

(a)   

to monitor the accounting arrangements of the company and its

subsidiaries (if any), and

(b)   

to identify any respects in which those arrangements are not

5

appropriate tax accounting arrangements.

Explanation for auditors

2     (1)  

This paragraph applies if a large company, or any of its subsidiaries, does

not have appropriate tax accounting arrangements at any time in a financial

year of the company.

10

      (2)  

Before the report date, the senior accounting officer of the company must

provide the company’s auditor for the financial year with an explanation of

the respects in which the accounting arrangements of the company and its

subsidiaries (if any) are not appropriate tax accounting arrangements.

      (3)  

“The report date” means the date on which the auditor’s report on the

15

company’s accounts for the financial year is finalised.

Certificate for Commissioners

3     (1)  

The senior accounting officer of a large company must provide the

Commissioners with a Type A or Type B certificate for each financial year of

the company.

20

      (2)  

A Type A certificate is a certificate stating that the company and its

subsidiaries (if any) had appropriate tax accounting arrangements

throughout the financial year.

      (3)  

A Type B certificate is a certificate—

(a)   

stating whether the company, and each of its subsidiaries (if any),

25

had appropriate tax accounting arrangements throughout the

financial year,

(b)   

giving an explanation of the respects in which the accounting

arrangements of the company and its subsidiaries (if any) were not

appropriate tax accounting arrangements, and

30

(c)   

stating whether an explanation has been provided to the company’s

auditors in accordance with paragraph 2.

      (4)  

The certificate must be provided—

(a)   

by such means and in such form as is reasonably specified by an

officer of Revenue and Customs, and

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(b)   

not later than the end of the period for filing the accounts for the

financial year (or such later time as an officer of Revenue and

Customs may have allowed).

Notifying Commissioners of name of senior accounting officer

4     (1)  

For each financial year a large company must notify the Commissioners of

40

the name of each person who was its senior accounting officer at any time

during the year.

      (2)  

The notification must be given—

 
 

Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

340

 

(a)   

by such means and in such form as is reasonably specified by an

officer of Revenue and Customs, and

(b)   

not later than the end of the period for filing the accounts for the

financial year (or such later time as an officer of Revenue and

Customs may have allowed for providing the certificate for the

5

financial year under paragraph 3).

Penalty for failure to comply with main duty

5     (1)  

This paragraph applies if a senior accounting officer fails to comply with

paragraph 1 at any time in a financial year.

      (2)  

The senior accounting officer is liable to a penalty of £5,000.

10

      (3)  

A person is not liable to more than one penalty under this paragraph in

respect of the same company and the same financial year.

Penalty for failure to provide explanation

6     (1)  

This paragraph applies if a senior accounting officer fails to provide an

explanation to the company’s auditor in accordance with paragraph 2.

15

      (2)  

The senior accounting officer is liable to a penalty of £5,000.

Penalties for failure to provide certificate etc

7     (1)  

This paragraph applies if a senior accounting officer—

(a)   

fails to provide a certificate in accordance with paragraph 3, or

(b)   

provides a certificate in accordance with that paragraph that

20

contains a careless or deliberate inaccuracy.

      (2)  

The senior accounting officer is liable to a penalty of £5,000.

      (3)  

For the purposes of this Schedule, an inaccuracy is careless if the inaccuracy

is due to a failure by the senior accounting officer to take reasonable care.

      (4)  

An inaccuracy in a certificate that was neither careless nor deliberate when

25

the certificate was given is to be treated as careless if the senior accounting

officer—

(a)   

discovered the inaccuracy some time later, and

(b)   

did not take reasonable steps to inform HMRC.

More than one senior accounting officer

30

8     (1)  

This paragraph applies if the identity of the senior accounting officer of a

company changes.

      (2)  

If (but for this sub-paragraph) more than one person would be liable to a

penalty under paragraph 5 in respect of a financial year of the company,

only the one who became the senior accounting officer latest in the year is

35

liable to such a penalty.

      (3)  

If a person who is or has been the senior accounting officer of the company

complies, or purports to comply, with paragraph 2 in respect of a financial

year, no other person is liable to a penalty under paragraph 6 in respect of

that company and that financial year.

40

 
 

Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

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      (4)  

If a person who is or has been the senior accounting officer of the company

complies, or purports to comply, with paragraph 3 in respect of a financial

year, no other person is liable to a penalty under paragraph 7 in respect of

that company and that financial year.

      (5)  

A person who is replaced as the senior accounting officer of the company

5

before the last day for compliance with paragraph 2 or 3 in respect of a

financial year is not liable to a penalty under paragraph 6 or 7(1)(a) for

failing to comply with that paragraph in respect of that company and that

financial year.

Penalty for failure to notify Commissioners of name of senior accounting officer

10

9          

A large company is liable to a penalty of £5,000 if it fails to notify the

Commissioners of the name of its senior accounting officer or officers in

accordance with paragraph 4.

Reasonable excuse

10    (1)  

Liability to a penalty for a failure to comply with this Schedule does not arise

15

if the senior accounting officer or large company 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

20

attributable to events outside the person’s control,

(b)   

where the person relies on any other person to do anything, that is

not a reasonable excuse unless the first person took reasonable care

to avoid the failure, and

(c)   

where the person had a reasonable excuse for the failure but the

25

excuse has ceased, the person is to be treated as having continued to

have the excuse if the failure is remedied without unreasonable

delay after the excuse ceased.

Assessment of penalties

11    (1)  

Where a senior accounting officer or a large company becomes liable for a

30

penalty under this Schedule—

(a)   

HMRC may assess the penalty, and

(b)   

if they do so, they must notify the officer or company liable for the

penalty.

      (2)  

An assessment of a penalty under this Schedule for a failure in respect of a

35

financial year, or an inaccuracy in a certificate for a financial year, may not

be made—

(a)   

more than 6 months after the failure or inaccuracy first comes to the

attention of an officer of Revenue and Customs, or

(b)   

more than 6 years after the end of the period for filing the accounts

40

for the financial year.

Appeal

12    (1)  

A person may appeal against a decision of HMRC that a penalty is payable

by that person.

 
 

Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

342

 

      (2)  

Notice of an appeal must be given—

(a)   

in writing,

(b)   

before the end of the period of 30 days beginning with the date on

which the notification under paragraph 11 was issued, and

(c)   

to HMRC.

5

      (3)  

Notice of an appeal must state the grounds of appeal.

      (4)  

On an appeal that is notified to the tribunal, the tribunal may confirm or

cancel the decision.

      (5)  

Subject to this paragraph and paragraph 13, the provisions of Part 5 of TMA

1970 relating to appeals have effect in relation to appeals under this

10

Schedule as they have effect in relation to an appeal against an assessment

to income tax.

Enforcement of penalties

13    (1)  

A penalty under this Schedule must be paid—

(a)   

before the end of the period of 30 days beginning with the date on

15

which the notification under paragraph 11 was issued, or

(b)   

if a notice of appeal against the penalty is given, before the end of the

period of 30 days beginning with the date on which the appeal is

determined or withdrawn.

      (2)  

A penalty under this Schedule may be enforced as if it were income tax

20

charged in an assessment and due and payable.

Power to change amount of penalties

14    (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 5, 6, 7 and 9 such other sums

25

as appear to them to be justified by the change.

      (2)  

In sub-paragraph (1), in relation to a specified sum, “relevant date” means—

(a)   

the date on which this Act is passed, and

(b)   

in relation to that sum, each date on which the power conferred by

that sub-paragraph has been exercised.

30

      (3)  

Regulations under this paragraph do not apply to—

(a)   

a failure that occurs in respect of a financial year of a company that

begins before the date on which they come into force, or

(b)   

an inaccuracy in a certificate that was provided to HMRC in respect

of such a financial year.

35

Application of provisions of TMA 1970

15         

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)   

section 108 (responsibility of company officers),

40

(b)   

section 114 (want of form), and

(c)   

section 115 (delivery and service of documents).

 
 

Finance Bill
Schedule 46 — Duties of senior accounting officers of large companies

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Meaning of “appropriate tax accounting arrangements”

16    (1)  

“Appropriate tax accounting arrangements” means accounting

arrangements that enable the liability to taxes and duties of the company

and its subsidiaries (if any) to be calculated accurately.

      (2)  

“Accounting arrangements” includes arrangements for keeping accounting

5

records.

      (3)  

“Taxes and duties” means taxes and duties the collection and management

of which is the responsibility of the Commissioners.

Meaning of “large company”

17    (1)  

“Large company”, in relation to a financial year, means a company that—

10

(a)   

does not qualify as small or medium-sized for the purposes of Part

15 of the Companies Act 2006 (accounts and reports) in relation to

that year (see sections 383 and 465 of that Act), and

(b)   

is not, throughout that year, a member of a group headed by another

company that satisfies paragraph (a).

15

      (2)  

The Treasury may by regulations provide that a company of a description

specified in the regulations is not a large company for the purposes of this

Schedule.

Meaning of “senior accounting officer”

18         

“Senior accounting officer”, in relation to a company, means the director or

20

officer of the company who has overall responsibility for the company’s

financial accounting arrangements.

Regulations

19    (1)  

Regulations under this Schedule are to be made by statutory instrument.

      (2)  

A statutory instrument containing regulations under this Schedule is subject

25

to annulment in pursuance of a resolution of the House of Commons.

Other definitions

20         

In this Schedule—

“auditor” means an auditor appointed for the purposes of the

Companies Act 2006;

30

“auditor’s report” means the report that the auditor is required to make

to the company’s members under the Companies Act 2006;

“the Commissioners” means the Commissioners for Her Majesty’s

Revenue and Customs;

“company” means a company within the meaning of the Companies

35

Act 2006;

“financial year”, in relation to a company, has the same meaning as in

the Companies Act 2006 (see section 390 of that Act);

“group” has the same meaning as in Part 15 of the Companies Act 2006

(accounts and reports) (see section 474 of that Act);

40

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

 
 

Finance Bill
Schedule 47 — Amendment of information and inspection powers

344

 

“period for filing”, in relation to accounts, has the same meaning as in

the Companies Acts (see section 442 of the Companies Act 2006);

“subsidiary” has the same meaning as in the Companies Acts (see

sections 1159 and 1160 of, and Schedule 6 to, the Companies Act

2006);

5

“tribunal” means the First-tier Tribunal or, where determined by or

under Tribunal Procedure Rules, the Upper Tribunal.

Schedule 47

Section 94

 

Amendment of information and inspection powers

1          

Schedule 36 to FA 2008 (information and inspection powers) is amended as

10

follows.

2     (1)  

Paragraph 3 (approval etc of taxpayer notices and third party notices) is

amended as follows.

      (2)  

After sub-paragraph (2) insert—

   “(2A)  

An application for approval under this paragraph may be made

15

without notice (except as required under sub-paragraph (3)).”

      (3)  

In sub-paragraph (3)(c), after “is” insert “to be”.

3     (1)  

Paragraph 5 (power to obtain information and documents about persons

whose identity is not known) is amended as follows.

      (2)  

After sub-paragraph (3) insert—

20

   “(3A)  

An application for approval under this paragraph may be made

without notice.”

      (3)  

In sub-paragraph (4), for “give its approval for the purposes of” substitute

“approve the giving of a notice under”.

4          

In paragraph 6 (notices), insert at the end—

25

    “(4)  

A decision of the tribunal under paragraph 3, 4 or 5 is final (despite

the provisions of sections 11 and 13 of the Tribunals, Courts and

Enforcement Act 2007).”

5     (1)  

Paragraph 10 (power to inspect business premises etc) is amended as

follows.

30

      (2)  

In sub-paragraph (3), in the definition of “business assets”, for “, excluding

documents” substitute “(but see sub-paragraph (4))”.

      (3)  

After that sub-paragraph insert—

    “(4)  

For the purposes of this Schedule, “business assets” does not

include documents, other than—

35

(a)   

documents that are trading stock for the purposes of

Chapter 11A of Part 2 of ITTOIA 2005 (see section 172A of

that Act), and

(b)   

documents that are plant for the purposes of Part 2 of CAA

2001.”

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