Finance Bill

House of Commons

Session 2008 - 09
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Other Bills before Parliament

Finance Bill

Finance Bill
Part 7 — Administration
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(b)
make provision modifying an enactment or instrument (whenever
passed or made).
(5)
“Modifying” includes amending, repealing or revoking.
(6)
An order under this section is to be made by statutory instrument.
(7)
A statutory instrument containing an order under this section is subject to
5
annulment in pursuance of a resolution of the House of Commons.
Interest
100
Late payment interest on sums due to HMRC
(1)
This section applies to any amount that is payable by a person to HMRC under
or by virtue of an enactment.
10
(2)
But this section does not apply to—
(a)
an amount of corporation tax,
(b)
an amount of petroleum revenue tax, or
(c)
an amount of any description specified in an order made by the
Treasury.
15
(3)
An amount to which this section applies carries interest at the late payment
interest rate from the late payment interest start date until the date of payment.
(4)
The late payment interest start date in respect of any amount is the date on
which that amount becomes due and payable.
(5)
In Schedule 53—
20
(a)
Part 1 makes special provision as to the amount on which late payment
interest is calculated,
(b)
Part 2 makes special provision as to the late payment interest start date,
(c)
Part 3 makes special provision as to the date to which late payment
interest runs, and
25
(d)
Part 4 makes provision about the effect that the giving of a relief has on
late payment interest.
(6)
Subsection (3) applies even if the late payment interest start date is a non-
business day within the meaning of section 92 of the Bills of Exchange Act 1882.
(7)
Late payment interest is to be paid without any deduction of income tax.
30
(8)
Late payment interest is not payable on late payment interest.
(9)
For the purposes of this section any reference to the payment of an amount to
HMRC includes a reference to its being set off against an amount payable by
HMRC (and, accordingly, the reference to the date on which an amount is paid
includes a reference to the date from which the set-off takes effect).
35
101
Repayment interest on sums to be paid by HMRC
(1)
This section applies to—
(a)
any amount that is payable by HMRC to any person under or by virtue
of an enactment, and

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(b)
a relevant amount paid by a person to HMRC that is repaid by HMRC
to that person or to another person.
(2)
But this section does not apply to—
(a)
an amount constituting a repayment of corporation tax,
(b)
an amount constituting a repayment of petroleum revenue tax, or
5
(c)
an amount of any description specified in an order made by the
Treasury.
(3)
An amount to which this section applies carries interest at the repayment
interest rate from the repayment interest start date until the date on which the
payment or repayment is made.
10
(4)
In Schedule 54—
(a)
Parts 1 and 2 define the repayment interest start date, and
(b)
Part 3 makes supplementary provision.
(5)
Subsection (3) applies even if the repayment interest start date is a non-
business day within the meaning of section 92 of the Bills of Exchange Act 1882.
15
(6)
Repayment interest is not payable on an amount payable in consequence of an
order or judgment of a court having power to allow interest on the amount.
(7)
Repayment interest is not payable on repayment interest.
(8)
For the purposes of this section—
(a)
“relevant amount” means any sum that was paid in connection with
20
any liability (including any purported or anticipated liability) to make
a payment to HMRC under or by virtue of an enactment, and
(b)
any reference to the payment or repayment of an amount by HMRC
includes a reference to its being set off against an amount owed to
HMRC (and, accordingly, the reference to the date on which an amount
25
is paid or repaid by HMRC includes a reference to the date from which
the set-off takes effect).
102
Rates of interest
(1)
The late payment interest rate is the rate provided for in regulations made by
the Treasury under this subsection.
30
(2)
The repayment interest rate is the rate provided for in regulations made by the
Treasury under this subsection.
(3)
Regulations under subsection (1) or (2)—
(a)
may make different provision for different purposes,
(b)
may either themselves specify a rate of interest or make provision for
35
such a rate to be determined (and to change from time to time) by
reference to such rate, or the average of such rates, as may be referred
to in the regulations,
(c)
may provide for rates to be reduced below, or increased above, what
they otherwise would be by specified amounts or by reference to
40
specified formulae,
(d)
may provide for rates arrived at by reference to averages to be rounded
up or down,
(e)
may provide for circumstances in which alteration of a rate of interest
is or is not to be take place, and
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(f)
may provide that alterations of rates are to have effect for periods
beginning on or after a day determined in accordance with the
regulations in relation to interest running from before that day as well
as from or from after that day.
103
Supplementary
5
(1)
In sections 100 to 102—
“HMRC” means Her Majesty’s Revenue and Customs;
“late payment interest” means interest payable under section 100;
“repayment interest” means interest payable under section 101;
“revenue” has the meaning given in section 5(4) of CRCA 2005.
10
(2)
A reference to the date on which an amount becomes due and payable is a
reference to the date (however described) on or before which the amount must
be paid.
(3)
Sections 100 to 102 come into force on such day as the Treasury may by order
appoint.
15
(4)
An order under subsection (3)—
(a)
may commence a provision generally or only for specified purposes,
and
(b)
may appoint different days for different provisions or for different
purposes.
20
(5)
The Treasury may by order make any incidental, supplemental, consequential,
transitional, transitory or saving provision which may appear appropriate in
consequence of, or otherwise in connection with, those sections.
(6)
An order under subsection (5) may include provision amending, repealing or
revoking any provision of any Act or subordinate legislation whenever passed
25
or made (including this Act and any Act amended by it).
(7)
An order under subsection (5) may make different provision for different
purposes.
(8)
The following are to be made by statutory instrument—
(a)
orders under section 100(2) or 101(2),
30
(b)
regulations under section 102(1) or (2), and
(c)
orders under subsection (3) or (5).
(9)
A statutory instrument containing—
(a)
an order under section 100(2) or 101(2),
(b)
regulations under section 102(1) or (2),
35
(c)
an order under subsection (5) which includes provision amending or
repealing any provision of an Act,

is subject to annulment in pursuance of a resolution of the House of Commons.
104
Miscellaneous amendments
(1)
Section 239 of ITA 2007 (date from which interest is chargeable when EIS relief
40
is withdrawn or reduced) is amended as follows.
(2)
In subsection (1)—

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(a)
for “in column 1 of the following table” substitute “in subsection (2)”,
(b)
for “given by the corresponding entry in column 2 of the table”
substitute “31 January next following the tax year for which the
assessment is made”, and
(c)
omit the table.
5
(3)
For subsection (2) substitute—
“(2)
The provisions are—
section 163,
section 164,
section 173A,
10
any of sections 181 to 188,
section 209,
section 212(1),
section 213,
section 224,
15
section 232, and
section 233.”
(4)
The following provisions (which require HMRC to make an order specifying
the new rate of interest when that rate is changed by operation of regulations)
are omitted—
20
(a)
section 178(5) of FA 1989, and
(b)
section 197(5) of FA 1996.
Penalties
105
Penalties for failure to make returns etc
(1)
Schedule 55 contains provision for imposing penalties on persons in respect of
25
failures to make returns and other documents relating to liabilities for tax.
(2)
That Schedule comes into force on such day as the Treasury may by order
appoint.
(3)
An order under subsection (2)—
(a)
may commence a provision generally or only for specified purposes,
30
and
(b)
may appoint different days for different provisions or for different
purposes.
(4)
The Treasury may by order make any incidental, supplemental, consequential,
transitional, transitory or saving provision which may appear appropriate in
35
consequence of, or otherwise in connection with, Schedule 55.
(5)
An order under subsection (4) may include provision amending, repealing or
revoking any provision of any Act or subordinate legislation whenever passed
or made (including this Act and any Act amended by it).
(6)
An order under subsection (4) may make different provision for different
40
purposes.
(7)
An order under this section is to be made by statutory instrument.

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(8)
A statutory instrument containing an order under subsection (4) which
includes provision amending or repealing any provision of an Act is subject to
annulment in pursuance of a resolution of the House of Commons.
106
Penalties for failure to pay tax
(1)
Schedule 56 contains provision for imposing penalties on persons in respect of
5
failures to comply with obligations to pay tax.
(2)
That Schedule comes into force on such day as the Treasury may by order
appoint.
(3)
An order under subsection (2)—
(a)
may commence a provision generally or only for specified purposes,
10
and
(b)
may appoint different days for different provisions or for different
purposes.
(4)
The Treasury may by order make any incidental, supplemental, consequential,
transitional, transitory or saving provision which may appear appropriate in
15
consequence of, or otherwise in connection with, Schedule 56.
(5)
An order under subsection (4) may include provision amending, repealing or
revoking any provision of any Act or subordinate legislation whenever passed
or made (including this Act and any Act amended by it).
(6)
An order under subsection (4) may make different provision for different
20
purposes.
(7)
An order under this section is to be made by statutory instrument.
(8)
A statutory instrument containing an order under subsection (4) which
includes provision amending or repealing any provision of an Act is subject to
annulment in pursuance of a resolution of the House of Commons.
25
107
Suspension of penalties during currency of agreement for deferred payment
(1)
This section applies if—
(a)
a person (“P”) fails to pay an amount of tax falling within the Table in
subsection (5) when it becomes due and payable,
(b)
before the date on which P becomes liable to any penalty for that
30
failure, P makes a request to an officer of Revenue and Customs that
payment of the amount of tax be deferred, and
(c)
whether before or after that date, an officer of Revenue and Customs
agrees that payment of that amount may be deferred for a period (“the
deferral period”).
35
(2)
P is not liable to a penalty for failing to pay the amount mentioned in
subsection (1) if—
(a)
the penalty falls within the Table, and
(b)
P would (apart from this subsection) become liable to it during the
deferral period.
40
(3)
But if—
(a)
P breaks the agreement (see subsection (4)), and

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(b)
an officer of Revenue and Customs serves on P a notice specifying any
penalty to which P would become liable apart from subsection (2),

P becomes liable, at the date of the notice, to that penalty.
(4)
P breaks an agreement if—
(a)
P fails to pay the amount of tax in question when the deferral period
5
ends, or
(b)
the deferral is subject to P complying with a condition (including a
condition that part of the amount be paid during the deferral period)
and P fails to comply with it.
(5)
The taxes and penalties referred to in subsections (1) and (2) are—
10

Tax
Penalty

Income tax or capital gains tax
Surcharge under section 59C(2) or (3) of TMA

1970

Value added tax
Surcharge under section 59(4) or 59A(4) of

VATA 1994

15

Aggregates levy
Penalty interest under paragraph 5 of Schedule

5 to FA 2001

Climate change levy
Penalty interest under paragraph 82 of

Schedule 6 to FA 2000

Landfill tax
Penalty interest under paragraph 27(2) of

20

Schedule 5 to FA 1996

Insurance premium tax
Penalty under paragraph 15(2) or (3) of

Schedule 7 to FA 1994 which is payable by

virtue of paragraph 15(1)(a) of that Schedule.

Any duty of excise
Penalty under section 9(2) or (3) of FA 1994

25

which is imposed for a failure to pay an amount

of any duty of excise or an amount payable on

account of any such duty.

(6)
If the agreement mentioned in subsection (1)(c) is varied at any time by a
further agreement between P and an officer of Revenue and Customs, this
30
section applies from that time to the agreement as varied.
(7)
The Treasury may by order amend the Table by adding or removing a tax or a
penalty.
(8)
An order under subsection (7) is to be made by statutory instrument.
(9)
A statutory instrument containing an order under subsection (7) is subject to
35
annulment in pursuance of a resolution of the House of Commons.
(10)
In this section, except in the entries in the Table, “penalty” includes surcharge
and penalty interest.
(11)
This section has effect where the agreement mentioned in subsection (1)(c) is
made on or after 24 November 2008.
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