Taxes Management Act 1970

PART II U.K. RETURNS OF INCOME AND GAINS

Income tax U.K.

7 [Notice of liability to income tax. U.K.

(1) Every person who is chargeable to income tax for any year of assessment and has neither—

(a) delivered a return of his profits or gains or his total income for that year, nor

(b) received a notice under section 8 of this Act requiring such a return,

shall, subject to subsections (2) to (5) below, within twelve months from the end of that year, give notice to the inspector that he is so chargeable, specifying each separate source of income.

(2) A source of income is excluded for the purposes of subsection (1) above in relation to any year of assessment if—

(a) all payments of, or on account of, income from it during that year, and

(b) all income from it for that year which does not consist of payments,

have or has been taken into account in the making of deductions or repayments of tax under section 203 of the principal Act.

(3) A source of income is excluded for the purposes of subsection (1) above in relation to any person and any year of assessment if all income from it for that year has been assessed or has been taken into account—

(a) in determining that person’s liability to tax, or

(b) in the making of deductions or repayments of tax under section 203 of the principal Act.

(4) A source of income is excluded for the purposes of subsection (1) above in relation to any person and any year of assessment if all income from it for that year is—

(a) income from which income tax has been deducted;

(b) income from or on which income tax is treated as having been deducted or paid (not being income consisting of a payment to which section 559 of the principal Act applies); or

(c) income chargeable under Schedule F.

and that person is not for that year liable to tax at a rate other than basic rate.

(5) A person shall not be required to give notice under subsection (1) above in respect of a year of assessment if and to the extent that his total income for that year consists of income from sources—

(a) which are excluded under subsections (2) to (4) above, or

(b) in respect of income from which he could not become liable to tax under assessments made more than twelve months after the end of that year.

(6) If any person, for any year of assessment, fails to comply with subsection (1) above as respects any source of income, he shall be liable to a penalty not exceeding the amount of the tax for which he is liable, in respect of income from that source for that year, under assessments made more than twelve months after the end of that year.

(7) In the case of a partner, the reference in subsection (6) above to the tax for which he is liable in respect of income from any source does not include a reference to tax assessable in the name of the partnership on so much of the income from that source as falls to be included in the total income of any other person F1 .]

Textual Amendments

F1 Finance Act 1988 s. 120with respect to notices required to be given for the year 1988-89and subsequent years. Previously

“7.—(1) Every person who is chargeable to income tax for any year of assessment and who has not delivered a return of his profits or gains or his total income for that year in accordance with the provisions of the Income Tax Acts shall, not later than one year after the end of that year of assessment, give notice that he is so chargeable.(2) A notice under this section shall be given to the inspector ......(a)(3) If any person fails to give a notice which he is required to give under this section he shall be liable to a penalty not exceeding £100.”

(a)

Words omitted repealed for1973—74et seq. byFinance Act 1971 ss.37and 38andSch.14 Part II.

8 [Personal return. U.K.

(1) For the purposes of assessing a person to income tax, he may be required by a notice given to him by an inspector—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements, relating to information contained in the return, as may be required in pursuance of the notice.

(2) Every return under this section shall include a declaration by the person making the return to the effect than the return is to the best of his knowledge correct and complete.

(3) A notice under this section may require different information, accounts and statements for different periods or in relation to different descriptions of source of income.

(4) Notices under this section may require different information, accounts and statements in relation to different descriptions of person F2 .

Textual Amendments

F2 See—Finance Act 1974 s. 24—notice may require particulars of emoluments of certain employments etc. under non-residents duties performed for benefit of a person resident or trading etc., in the United Kingdom.Capital Gains Tax Act 1979 (c. 14, SIF 63:2) S. 5(5)and Sch. 1—return of small deposits and gains.Capital Allowances Act 1990 (c. 1, SIF 63:1) s. 140(3)—inclusion in returns of income of any claim for capital allowances.

Modifications etc. (not altering text)

C1 S. 8 modified (6.3.1992 with effect as mentioned in s. 289(1)(2) of the amending Act) by Taxation of Chargeable Gains Act 1992 (c. 12), ss. 3(6)(b), 289 (with ss. 60, 101(1), 171, 201(3))

8A Trustee’s return. U.K.

(1) For the purpose of assessing a trustee of a settlement, and the settlors and beneficiaries, to income tax an inspector may by a notice given to the trustee require the trustee—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements, relating to information contained in the return, as may be required in pursuance of the notice;

and a notice may be given to any one trustee or separate notices may be given to each trustee or to such trustees as the inspector thinks fit.

(2) Every return under this section shall include a declaration by the person making the return to the effect that the return is to the best of his knowledge correct and complete.

(3) A notice under this section may require different information, accounts and statements for different periods or in relation to different descriptions of source of income.

(4) Notices under this section may require different information, accounts and statements in relation to different descriptions of settlement.

9 Partnership return. U.K.

(1) Where a trade or profession is carried on by two or more persons jointly, for the purposes of making assessment to income tax in the partnership name an inspector may act under subsection (2) or (3) below (or both).

(2) An inspector may by a notice given to the partners require such person as is identified in accordance with rules given with the notice—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements as may be required in pursuance of the notice.

(3) An inspector may by a notice given to any partner require the partner—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements as may be required in pursuance of the notice;

and a notice may be given to any one partner or separate notices may be given to each partner or to such partners as the inspector thinks fit.

(4) Every return under this section shall include—

(a) a declaration of the names and residences of the partners;

(b) a declaration by the person making the return to the effect that the return is to the best of his knowledge correct and complete.

(5) A notice under this section may require different information, accounts and statements for different periods or in relation to different descriptions of sources of income.

(6) Notices under this section may require different information, accounts and statements in relation to different descriptions of partnership F3 .]

Textual Amendments

F3 Ss 8, 8A, 9 substituted for ss, 8, 9 (with effect where a notice to deliver a return was, or falls to be, given after 5.4.1990) by Finance Act 1990 (c. 29), s. 90(1)(5)

Corporation tax U.K.

10 [Notice of liability to corporation tax. U.K.

(1) Every company which is chargeable to corporation tax for any accounting period and has neither—

(a) made a return of its profits for that period, nor

(b) received a notice under section 11 of this Act requiring such a return,

shall, within twelve months from the end of that period, give notice to the inspector that it is so chargeable.

(2) If any company, for any accounting period ending on or before the appointed day, fails to comply with subsection (1) above, it shall be liable to a penalty not exceeding the amount of the corporation tax for which it is liable, in respect of its profits for that period, under assessments made more than twelve months after the end of that period.

(3) If any company, for any accounting period ending after the appointed day, fails to comply with subsection (1) above, it shall be liable to a penalty not exceeding the amount by which so much of the corporation tax chargeable on its profits for that period as remains unpaid for twelve months after the end of that period exceeds any income tax borne by deduction from payments included in those profits.

(4) In determining—

(a) for the purposes of subsection (2) above, for how much corporation tax a company is liable, in respect of its profits for an accounting period, under assessments made more than twelve months after the end of that period; or

(b) for the purposes of subsection (3) above, how much of the corporation tax chargeable on the profits of a company for an accounting period remained unpaid at the time of any failure to comply with subsection (1) above,

no account shall be taken of the discharge of any liablility for that tax which, pursuant to a claim under subsection (3) of section 239 of the principal Act, is attributable to an amount of surplus advance corporation tax, as defined in that subsection.

(5) In this section “the appointed day” means the day appointed for the purposes of section 8(3) of the principal Act F4 .]

Textual Amendments

F4 Finance Act 1980 (c. 39 SIF 63:1,2) s. 121in respect of notices given for accounting periods ending after 31March 1989.Previously

“10.—(1) Every company which is chargeable to corporation tax for any accounting period and which has not made a return of its profits for that accounting period give notice to the inspector that it is so chargeable.(2) If a company fails to give a notice which it is required to give under this section the company shall be liable to a penalty not exceeding £100”.

11 Return of profits. [1966 Sch.VI 2.] U.K.

(1) A company may be required by a notice served on the company by an inspector or other officer of the Board to deliver to the officer within the time limited by the notice a return of the profits of the company computed in accordance with the Corporation Tax Acts—

(a) specifying the income taken into account in computing those profits, with the amount from each source,

(b) giving particulars of all disposals giving rise to chargeable gains or allowable losses under the provisions of [the Capital Gains Tax Act 1979 F5 ] and the Corporation Tax Acts and particulars of those chargeable gains or allowable losses, and

(c) giving particulars of all charges on income to be deducted against those profits for the purpose of assessment to corporation tax F6 F7 .

(2) A notice under this section may require a return of profits arising in any period during which the company was within the charge to corporation tax F7 .

(3) Every return under this section shall include a declaration [by the person making the return F8 ] to the effect that the return is [to the best of his knowledge F8 ] correct and complete F7 .

(4) A return under this section which includes profits which are payments on which the company has borne income tax by deduction shall specify the amount of income tax so borne.

(5) A notice under this section may require the inclusion in the return of particulars of management expenses, capital allowances and balancing charges which have been taken into account in arriving at the profits included in the return.

[(6) A notice under this section may require the inclusion in the return of particulars of advance corporation tax paid by the company (and not repaid) and of any surplus advance corporation tax carried forward under section [239(4) of the principal Act F9 ] F10 .] F7 F11

Textual Amendments

F5 Capital Gains Tax Act 1979 (c. 14) s. 157(2)andSch.7 para.8

F6 See Income and Corporation Taxes Act 1988 s. 451(2)(a)—the Treasury may modify s. 11 in its application to Lloyd's underwriting agency companies by regulations made by statutory instrument for accounting periods ending after a day to be appointed.

F7 See—Finance (No. 2) Act 1987 ss. 82(2)(3)(4), 95(2)(3), Income and Corporation Taxes Act 1988 Sch. 29 para. 10(1)and Finance Act 1990 s. 91for modifications in the event of a notice being served after a day to be appointed.

F8 Finance Act 1990 s. 91(4), (8)with respect to any notice served on or after 26July 1990.

F9 Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1) Sch. 29 para. 10.Previously

“85(4) of the Finance Act 1972”.

F10 Finance Act 1972 s.111andSch.24 para.5with effect from6April1973.

F11 See—Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1)—s. 10(2)—time for payment of tax under Pay and File.Finance Act 1990—ss. 100and 102and Schs. 15and 16—claims for group relief and claims for capital allowances after a day to be appointed (see Income and Corporation Taxes Act 1988 s. 10).

11A [Notice of liability to capital gains tax. U.K.

(1) Every person who is chargeable to capital gains tax for any year of assessment and has neither—

(a) delivered a return of his chargeable gains for that year, nor

(b) received a notice under section 8 of this Act requiring such a return,

shall, within twelve months from the end of that year, give notice to the inspector that he is so chargeable; but a person all of whose chargeable gains for a year of assessment have been assessed shall not be required to give notice under this subsection in respect of that year.

(2) If any person, for any year of assessment, fails to comply with subsection (1) above, he shall be liable to a penalty not exceeding the amount of the tax for which he is liable, in respect of his chargeable gains for that year, under assessments made more than twelve months after the end of that year.

(3) In this section references to a person’s chargeable gains for a year of assessment include, if section 45(1)of the Capital Gains Tax Act 1979applies in relation to him and his wife in that year, her chargeable gains for that yearF12 .] F13

Textual Amendments

F12 S. 11A inserted (with effect with respect to notices required to be given for the year 1988-89 and subsequent years) by Finance Act 1988 (c. 39), s. 122(1)(3)

F13 S. 11A(3) repealed (for 1990-91 and subsequent years) by Finance Act 1988 (c. 39), s. 148, Sch. 14 Pt. VIII

12 Information about chargeable gains. [1965 Sch.X 1(1).] [1965 Sch.X 6(1); 1966 Sch.VI 2(6).] U.K.

[(1) [Sections 8 and 8A F14 ] of this Act shall apply in relation to capital gains tax as [they apply F14 ] in relation to income tax, and subject to any necessary modifications F15 .] F16

(2) A notice under section 8 [or section 8A F17 ] or section 11 of this Act may require particulars of any assets acquired by the person on whom the notice was served (or if the notice relates to income or chargeable gains of some other person, of any assets acquired by that other person) in the period specified in the notice (being a period beginning not earlier than 6th April 1965) but excluding—

[(a) any assets exempted by the following provisions of the Capital Gains Tax Act 1979, namely—

(i) section 19(4) (rights to winnings from pool betting, lotteries or games with prizes),

(ii) section 71 (government non-marketable securities),

(iii) section 130, 131 or 133 (passenger vehicles, decorations for valour or gallant conduct and foreign currency for personal expenditure) F18 ], or

(b) unless the amount or value of the consideration for its acquisition exceeded [£6,000 F19 ], any asset which is tangible movable property and is not within the exceptions in [section 128(6) F18 ] of the said Act (terminal markets and currency), or

(c) any assets acquired as trading stock.

M1 (3) The particulars required under this section may include particulars of the person from whom the asset was acquired, and of the consideration for the acquisition.

M2 (4) A return ofincome of a partnership F20 under section 9of this Act shall include—

(a) with respect to any disposal of partnership property during a period to which any part of the return relates, the like particulars as if the partnership were liable to tax on any chargeable gain accruing on the disposal, and

(b) with respect to any acquisition of partnership property, the particulars required under subsection (2) above.

M3 (5) In this section “trading stock” has the meaning given by section [100(2) F21 ] of the principal Act. F22

Textual Amendments

F14 Finance Act 1990 s. 90(2)(a), (5)where a notice to deliver a return was, or falls to be given after 5April 1990.Previously

“Section 8”

and

“it applies”.

F15 Finance Act 1988 (c. 39, SIF 63:1,2) s. 122with respect to notices required to be given for the year 1988-89and subsequent years. Previously

“(1) Sections 7 and 8 of this Act shall apply in relation to capital gains tax as they apply in relation to income tax.....(a) and subject to any necessary modifications.”

in s. 12(1).

(a)

Words omitted repealed for 1973-74et seq. by Finance Act 1971 ss.37and 38and Sch. 14 Part II.

F16 See—Capital Gains Tax Act 1979 (c. 14, SIF 63:2) s.5(5)andSch.1 para.3—return of small disposals and gains.Capital Gains Tax Act 1979 (c. 14, SIF 63:2) s.45(3)—returns of chargeable gains accruing to a married woman.

F17 Finance Act 1990 s. 90(2)(b), (5)where a notice to deliver a return was, or falls to be given after 5April 1990.

F18 Capital Gains Tax Act 1979 (c. 14 SIF 63:2) s.157(2)andSch.7 para.1(2), 9for1979—80et seq.

F19 Finance Act 1989 s. 123in relation to assets acquired on or after 6April 1989.Previously

“£3000”

(a)—see earlier editions for earlier years.

(a)—Finance Act 1982 s. 81(1)(b)in relation to assets acquired on or after 6April 1982.

F20 Repealed by Finance Act 1990 s. 90(2)(c),(5)and Sch. 19 Part Vwhere a notice to deliver a return was, or falls to be, given after 5April 1990.

F21 Income and Corporation Taxes Act 1988 (c. 1, SIF 63:1) Sch. 29 para. 32.

F22 See Finance Act 1990 s. 39—power to call for a return in connection with claims for roll-over relief on disposal of shares to employee share ownership trusts.

Marginal Citations

M1 1965

Sch. X (6)

M2 1965

Sch. X 10

M3 1965

S. 45(1)

[European Economic Interest Groupings U.K.

12A European Economic Interest Groupings.Official Journal of the European Communities No. L199/1. U.K.

(1) In this section “grouping” means a European Economic Interest Grouping formed in pursuance of Council Regulation (EEC) No. 2137/85 of 25th July 1985 (“the Council Regulation”), whether registered in Great Britain, in Northern Ireland, or elsewhere.

(2) For the purposes of making assessments to income tax, corporation tax and capital gains tax on members of a grouping, an inspector may act under subsection (3) or (4) below.

(3) In the case of a grouping which is registered in Great Britain or Northern Ireland or has an establishment registered in Great Britain or Northern Ireland, and inspector may by a notice given to the grouping require the grouping—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements as may be required in pursuance of the notice.

(4) In the case of any other grouping, an inspector may by a notice given to any member of the grouping resident in the United Kingdom, or if none is to any member of the grouping, require the member—

(a) to make and deliver to the inspector within the time limited by the notice a return containing such information as may be required in pursuance of the notice, and

(b) to deliver with the return such accounts and statements as may be required in pursuance of the notice,

and a notice may be given to any one of the members concerned or separate notices may be given to each of them or to such of them as the inspector thinks fit.

(5) Every return under this section shall include a declaration by the grouping or member making the return to the effect that the return is to the best of the maker’s knowledge correct and complete.

(6) A notice under this section may require different information, accounts and statements for different periods, in relation to different descriptions of income or gains or in relation to different descriptions of member.

(7) Notices under this section may require different information, accounts and statements in relation to different descriptions of grouping.

(8) Subject to subsection (9) below, where a notice is given under subsection (3) above, everything required to be done shall be done by the grouping acting through its manager or, where there is more than one, any of them; but where the manager of a grouping (or each of them) is a person other than an individual, the grouping shall act through the individual, or any of the individuals, designated in accordance with the Council Regulation as the representative of the manager (or any of them).

(9) Where the contract for the formation of a grouping provides that the grouping shall be validly bound only by two or more managers acting jointly, any declaration required by subsection (5) above to be included in a return made by a grouping shall be given by the appropriate number of managers F23

Textual Amendments

F23 S. 12A and cross-heading inserted (1.7.1989) by Finance Act 1990 (c. 29), s. 69, Sch. 11 paras. 2, 5

[F24 Voluntary returns U.K.

Textual Amendments

F24 S. 12D and cross-heading inserted (retrospective) by Finance Act 2019 (c. 1), s. 87(1)(3) (with s. 87(4))

12D Returns made otherwise than pursuant to a notice U.K.

(1) This section applies where—

(a) a person delivers a purported return (“the relevant return”) under section 8, 8A or 12AA (“the relevant section”) for a year of assessment or other period (“the relevant period”),

(b) no notice under the relevant section has been given to the person in respect of the relevant period, and

(c) HMRC treats the relevant return as a return made and delivered in pursuance of such a notice.

(2) For the purposes of the Taxes Acts—

(a) treat a relevant notice as having been given to the person on the day the relevant return was delivered, and

(b) treat the relevant return as having been made and delivered in pursuance of that notice (and, accordingly, treat it as if it were a return under the relevant section).

(3) “Relevant notice” means—

(a) in relation to section 8 or 8A, a notice under that section in respect of the relevant period;

(b) in relation to section 12AA, a notice under section 12AA(3) requiring the person to deliver a return in respect of the relevant period, on or before the day the relevant return was delivered (or, if later, the earliest day that could be specified under section 12AA).

(4) In subsection (1)(a) “purported return” means anything that—

(a) is in a form, and is delivered in a way, that a corresponding return could have been made and delivered had a relevant notice been given, and

(b) purports to be a return under the relevant section.

(5) Nothing in this section affects sections 34 to 36 or any other provisions of the Taxes Acts specifying a period for the making or delivering of any assessment (including self-assessment) to income tax or capital gains tax.]

Modifications etc. (not altering text)

C2 S. 12D power to amend conferred (retrospective) by Finance Act 2019 (c. 1), s. 87(3)(5)(b) (with s. 87(4))