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Finance Bill
Schedule 47 — Amendment of information and inspection powers

345

 

6     (1)  

Paragraph 11 (power to inspect premises used in connection with taxable

supplies etc) is amended as follows.

      (2)  

In sub-paragraph (1)—

(a)   

in paragraph (a), after “supplied” insert “or documents relating to

such goods”,

5

(b)   

in paragraph (b), after “acquired” insert “or documents relating to

such goods”, and

(c)   

in paragraph (c), after “as” insert “or in connection with”.

      (3)  

In sub-paragraph (2)(c), for “such goods” substitute “the supply of goods

under taxable supplies, the acquisition of goods from other member States

10

under taxable aquisitions or fiscal warehousing”.

      (4)  

In sub-paragraph (4)—

(a)   

for “sub-paragraph (1)” substitute “this paragraph”, and

(b)   

for “in that sub-paragraph” substitute “here”.

7          

In paragraph 12(5) (carrying out inspections)—

15

(a)   

for “with the approval of” substitute “in respect of an inspection

approved by”, and

(b)   

for “it is given with that approval” substitute “the inspection has

been so approved”.

8     (1)  

In paragraph 13 (approval of inspections) is amended as follows.

20

      (2)  

After sub-paragraph (1) insert—

   “(1A)  

An application for approval under this paragraph may be made

without notice.”

      (3)  

Insert at the end—

    “(3)  

A decision of the tribunal under this paragraph is final (despite the

25

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

Enforcement Act 2007).”

9     (1)  

Paragraph 21 (taxpayer notices) is amended as follows.

      (2)  

In sub-paragraph (6), after “that” (in the first place) insert “, as regards the

person,”.

30

      (3)  

In sub-paragraph (7), for “that” (in the third place) substitute “the”.

      (4)  

In sub-paragraph (8)—

(a)   

after “repayments” insert “of tax or withholding of income”, and

(b)   

after “64(2)” insert “or (2A)”.

      (5)  

After sub-paragraph (8) insert—

35

    “(9)  

In this paragraph, references to the person who made the return

are only to that person in the capacity in which the return was

made.”

10    (1)  

Paragraph 35 (special cases: groups of undertakings) is amended as follows.

      (2)  

In sub-paragraph (2)—

40

(a)   

for “paragraph 2” substitute “—

(a)   

paragraph 2(2)”, and

 
 

Finance Bill
Schedule 47 — Amendment of information and inspection powers

346

 

(b)   

insert at the end “, and

(b)   

the references in paragraph 3(5) to naming the

taxpayer are to making that statement and naming

the parent undertaking.”

      (3)  

For sub-paragraph (4) substitute—

5

    “(4)  

Where a third party notice is given to the parent undertaking for

the purpose of checking the tax position of more than one

subsidiary undertaking—

(a)   

paragraph 2(2) only requires the notice to state this, and

(b)   

the references in paragraph 3(5) to naming the taxpayer are

10

to making that statement.

     (4A)  

In relation to such a notice—

(a)   

in paragraph 3 (approval etc of notices), sub-paragraphs

(1) and (3)(e) do not apply,

(b)   

paragraph 4(1) (copying third party notices to taxpayer)

15

does not apply,

(c)   

paragraph 21 (restrictions on giving taxpayer notice where

taxpayer has made return) applies as if the notice was a

taxpayer notice or taxpayer notices given to each

subsidiary undertaking (or, if the notice names the

20

subsidiary undertakings to which it relates, to each of

those undertakings),

(d)   

paragraph 30(1) (appeal) has effect as if it permitted an

appeal on any grounds, and

(e)   

in paragraph 30(2) (no appeal in relation to taxpayer’s

25

statutory records), the reference to the taxpayer has effect

as if it were a reference to the parent undertaking or any of

its subsidiary undertakings.”

      (4)  

In sub-paragraph (5), for the words after “the notice” substitute “—

(a)   

sub-paragraphs (3) and (4) of that paragraph (approval of

30

tribunal) have effect as if they permitted, but did not

require, the officer to obtain the approval of the tribunal,

and

(b)   

paragraph 31 (appeal) has effect as if it permitted an appeal

on any grounds, but the parent undertaking may not

35

appeal against a requirement in the notice to produce any

document that forms part of the statutory records of the

parent undertaking or any of its subsidiary undertakings.”

      (5)  

Omit sub-paragraph (6).

11    (1)  

Paragraph 37 (special cases: partnerships) is amended as follows.

40

      (2)  

For sub-paragraph (2) substitute—

    “(2)  

Where, in respect of a chargeable period, any of the partners has—

(a)   

made a tax return under section 12AA of TMA 1970

(partnership returns), or

(b)   

made a claim or election in accordance with section

45

42(6)(b) of TMA 1970 (partnership claims and elections),

 
 

Finance Bill
Schedule 47 — Amendment of information and inspection powers

347

 

           

paragraph 21 (restrictions where taxpayer has made tax return)

has effect as if that return, claim or election had been made by each

of the partners.”

      (3)  

In sub-paragraph (3)—

(a)   

omit “to any person (other than one of the partners)”,

5

(b)   

for “paragraph 2” substitute “—

(a)   

paragraph 2(2)”, and

(c)   

insert at the end “, and

(b)   

the references in paragraph 3(5) to naming the

taxpayer are to making that statement and naming

10

the partnership.”

      (4)  

In sub-paragraph (4)—

(a)   

after “notice” insert “given to a person other than one of the

partners”, and

(b)   

in paragraph (b), for “each of the partners” substitute “any of the

15

partners in the partnership”.

      (5)  

For sub-paragraph (5) substitute—

    “(5)  

In relation to a third party notice given to one of the partners for

the purpose of checking the tax position of one or more of the

other partners (in their capacity as such)—

20

(a)   

in paragraph 3 (approval etc of notices), sub-paragraphs

(1) and (3)(e) do not apply,

(b)   

paragraph 4(1) (copying third party notices to taxpayer)

does not apply,

(c)   

paragraph 30(1) (appeal) has effect as if it permitted an

25

appeal on any grounds, and

(d)   

in paragraph 30(2) (no appeal in relation to taxpayer’s

statutory records), the reference to the taxpayer has effect

as if it were a reference to any of the partners in the

partnership.”

30

      (6)  

In sub-paragraph (6) for the words after “the notice” substitute “—

(a)   

sub-paragraphs (3) and (4) of that paragraph (approval of

tribunal) have effect as if they permitted, but did not

require, the officer to obtain the approval of the tribunal,

and

35

(b)   

paragraph 31 (appeal) has effect as if it permitted an appeal

on any grounds, but the partner to whom the notice is

given may not appeal against a requirement in the notice

to produce any document that forms part of that partner’s

statutory records.”

40

      (7)  

Omit sub-paragraph (7).

12         

After paragraph 37 insert—

“Information in connection with herd basis election

37A   (1)  

This paragraph applies to a taxpayer notice given to a person

carrying on a trade in relation to which a herd basis election is

45

 
 

Finance Bill
Schedule 47 — Amendment of information and inspection powers

348

 

made if the notice refers only to information or documents that

relate to—

(a)   

the animals kept for the purposes of the trade, or

(b)   

the products of those animals.

      (2)  

Paragraph 21 (restrictions on giving taxpayer notice where

5

taxpayer has made tax return) does not apply in relation to the

notice.

      (3)  

“Herd basis election” means an election under Chapter 8 of Part 2

of ITTOIA 2005 or Chapter 8 of Part 3 of CTA 2009.

Information from persons liable to counteraction of tax advantage

10

37B   (1)  

This paragraph applies to a taxpayer notice given to a person to

whom a counteraction provision applies by reason of one or more

transactions if the notice refers only to information or documents

relating to the transaction (or, if there are two or more

transactions, any of them).

15

      (2)  

Paragraph 21 (restrictions on giving taxpayer notice where

taxpayer has made tax return) does not apply in relation to the

notice.

      (3)  

“Counteraction provision” means—

(a)   

section 703 of ICTA (company liable to counteraction of

20

corporation tax advantage), or

(b)   

section 684 of ITA 2007 (person liable to counteraction of

income tax advantage).”

13    (1)  

Paragraph 39 (standard penalties) is amended as follows.

      (2)  

In sub-paragraph (2), for “A person to whom this paragraph applies”

25

substitute “The person”.

      (3)  

In the heading—

(a)   

omit “Standard”, and

(b)   

insert at the end “for failure to comply or obstruction”.

14         

In the heading before paragraph 40 (daily default penalties), insert at the end

30

for failure to comply or obstruction”.

15         

After that paragraph insert—

“Penalties for inaccurate information and documents

40A   (1)  

This paragraph applies if—

(a)   

in complying with an information notice, a person

35

provides inaccurate information or produces a document

that contains an inaccuracy, and

(b)   

condition A or B is met.

      (2)  

Condition A is that the inaccuracy is careless or deliberate.

      (3)  

An inaccuracy is careless if it is due to a failure by the person to

40

take reasonable care.

      (4)  

Condition B is that the person—

 
 

Finance Bill
Schedule 47 — Amendment of information and inspection powers

349

 

(a)   

discovers the inaccuracy some time later, and

(b)   

fails to take reasonable steps to inform HMRC.

      (5)  

The person is liable to a penalty not exceeding £3,000.

      (6)  

Where the information or document contains more than one

inaccuracy, a penalty is payable for each inaccuracy.”

5

16    (1)  

Paragraph 41 (power to change amount of penalties) is amended as follows.

      (2)  

In sub-paragraph (1), for “and 40(2)” substitute “, 40(2) and 40A(5)”.

      (3)  

In sub-paragraph (2)—

(a)   

after “(1)” insert “, in relation to a specified sum,”, and

(b)   

in paragraph (b), insert at the end “in relation to that sum”.

10

      (4)  

In sub-paragraph (3)—

(a)   

after “to” insert “—

(a)   

”, and

(b)   

insert at the end “, or

(b)   

an inaccuracy in any information or document

15

provided to HMRC before that date.”

      (5)  

Accordingly, in the heading omit “standard and daily default”.

17    (1)  

Paragraph 46 (assessment of penalty) is amended as follows.

      (2)  

In sub-paragraph (1)—

(a)   

for “or 40” substitute “, 40 or 40A”,

20

(b)   

omit “HMRC may”,

(c)   

at the beginning of paragraph (a), insert “HMRC may”, and

(d)   

at the beginning of paragraph (b), insert “if they do so, they must”.

      (3)  

In sub-paragraph (2), for “within 12 months of the relevant date” substitute

“within the period of 12 months beginning with the date on which the

25

person became liable to the penalty, subject to sub-paragraph (3)”.

      (4)  

For sub-paragraph (3) substitute—

    “(3)  

In a case involving an information notice against which a person

may appeal, an assessment of a penalty under paragraph 39 or 40

must be made within the period of 12 months beginning with the

30

latest of the following—

(a)   

the date on which the person became liable to the penalty,

(b)   

the end of the period in which notice of an appeal against

the information notice could have been given, and

(c)   

if notice of such an appeal is given, the date on which the

35

appeal is determined or withdrawn.

      (4)  

An assessment of a penalty under paragraph 40A must be made—

(a)   

within the period of 12 months beginning with the date on

which the inaccuracy first came to the attention of an

officer of Revenue and Customs, and

40

(b)   

within the period of 6 years beginning with the date on

which the person became liable to the penalty.”

      (5)  

Accordingly, in the heading omit “standard penalty or daily default”.

 
 

Finance Bill
Schedule 48 — Extension of information and inspection powers

350

 

18    (1)  

Paragraph 47 (right to appeal) is amended as follows.

      (2)  

In paragraph (a), for “or 40” substitute “, 40 or 40A”.

      (3)  

Accordingly, in the heading, omit “standard penalty or daily default”.

19         

In the heading before paragraph 48 (procedure on appeal), omit “standard or

daily default”.

5

20    (1)  

Paragraph 49 (enforcement) is amended as follows.

      (2)  

In sub-paragraph (1), for “or 40” substitute “, 40 or 40A”.

      (3)  

In sub-paragraph (2), for “or 40” substitute “, 40 or 40A”.

      (4)  

Accordingly, in the heading, omit “standard penalty or daily default”.

21    (1)  

Paragraph 63 (tax) is amended as follows.

10

      (2)  

In sub-paragraph (3)—

(a)   

omit the “and” at the end of paragraph (a), and

(b)   

for the words following paragraph (b) substitute “, and

(c)   

amounts listed in sub-paragraph (3A).”

      (3)  

After that sub-paragraph insert—

15

   “(3A)  

Those amounts are—

(a)   

any amount that is recoverable under paragraph 5(2) of

Schedule 11 to VATA 1994 (amounts shown on invoices as

VAT), and

(b)   

any amount that is treated as VAT by virtue of regulations

20

under section 54 of VATA 1994 (farmers etc).”

22    (1)  

Paragraph 64 (tax position) is amended as follows.

      (2)  

In sub-paragraph (1)(c), after “with” insert “the person’s liability to pay”.

      (3)  

After sub-paragraph (2) insert—

   “(2A)  

References in this Schedule to a person’s tax position also include,

25

where appropriate, a reference to the person’s position as regards

the withholding by the person of another person’s PAYE income

(as defined in section 683 of ITEPA 2003).”

Schedule 48

Section 95

 

Extension of information and inspection powers

30

1          

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

follows.

2          

In paragraph 5(4)(b) (power to obtain information and documents about

persons whose identity is not known), for the words from “, VATA 1994” to

the end substitute “or any other enactment relating to UK tax”.

35

 
 

Finance Bill
Schedule 48 — Extension of information and inspection powers

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3          

After paragraph 10 insert—

“Power to inspect business premises etc of involved third parties

10A   (1)  

An officer of Revenue and Customs may enter business premises

of an involved third party (see paragraph 61A) and inspect—

(a)   

the premises,

5

(b)   

business assets that are on the premises, and

(c)   

relevant documents that are on the premises,

           

if the inspection is reasonably required by the officer for the

purpose of checking the position of any person or class of persons

as regards a relevant tax.

10

      (2)  

The powers under this paragraph may be exercised whether or not

the identity of that person is, or the individual identities of those

persons are, known to the officer.

      (3)  

The powers under this paragraph do not include power to enter or

inspect any part of the premises that is used solely as a dwelling.

15

      (4)  

In relation to an involved third party, “relevant documents” and

“relevant tax” are defined in paragraph 61A.”

4     (1)  

Paragraph 12 (carrying out inspections) is amended as follows.

      (2)  

In sub-paragraph (1), for “this Part of this Schedule” substitute “paragraph

10, 10A or 11”.

20

      (3)  

Accordingly, in the heading, insert at the end “under paragraph 10, 10A or 11”.

5          

After that paragraph insert—

“Powers to inspect property for valuation etc

12A   (1)  

An officer of Revenue and Customs may enter and inspect

premises for the purpose of valuing the premises if the valuation

25

is reasonably required for the purpose of checking any person’s

position as regards income tax or corporation tax.

      (2)  

An officer of Revenue and Customs may enter premises and

inspect—

(a)   

the premises, and

30

(b)   

any other property on the premises,

           

for the purpose of valuing, measuring or determining the

character of the premises or property.

      (3)  

Sub-paragraph (2) only applies if the valuation, measurement or

determination is reasonably required for the purpose of checking

35

any person’s position as regards—

(a)   

capital gains tax,

(b)   

corporation tax in respect of chargeable gains,

(c)   

inheritance tax,

(d)   

stamp duty land tax, or

40

(e)   

stamp duty reserve tax.

 
 

 
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