Income Tax (Earnings and Pensions) Act 2003

[F1 Information U.K.

Textual Amendments

F1 Pt. 7 Ch. 1 substituted (with effect in accordance with Sch. 22 para. 2(2) of the amending Act) by Finance Act 2003 (c. 14), Sch. 22 para. 2(1)

421J Duty to provide information U.K.

(1) This section applies in relation to reportable events.

(2) Section 421K explains what are reportable events for the purposes of this section.

F2 (3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) [F3 An officer of Revenue and Customs] may by notice require any person to provide [F4 the officer] with such particulars of any reportable events—

(a) which take place in a period specified in the notice, and

(b) in relation to which that person is a responsible person,

as are required by the notice or, if no reportable event in relation to which that person is a responsible person has taken place in that period, to state that fact.

(5) A notice under subsection (4) must specify a date by which it must be complied with.

(6) That date must not be less than 30 days after the date when the notice is given.

F5 (7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F6 (8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9) Section 421L explains who are the responsible persons in relation to a reportable event.

(10) The particulars required [F7 by a notice under] this section must be provided in a form specified by [F8 the Commissioners for Her Majesty’s Revenue and Customs].

F9 (11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F10 (12) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F2 S. 421J(3) omitted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 227(2), 232

F3 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(1); S.I. 2005/1126, art. 2(2)(h)

F4 Words in s. 421J(4) substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 103(1)(i); S.I. 2005/1126, art. 2(2)(h)

F5 S. 421J(7) omitted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 227(2), 232

F6 S. 421J(8) omitted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 227(2), 232

F7 Words in s. 421J(10) substituted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 227(3), 232

F8 Words in Act substituted (18.4.2005) by Commissioners for Revenue and Customs Act 2005 (c. 11), s. 53(1), Sch. 4 para. 102(2); S.I. 2005/1126, art. 2(2)(h)

F9 S. 421J(11) omitted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 227(2), 232

F10 S. 421J(12) omitted (with effect in accordance with Sch. 8 para. 233 of the amending Act) by virtue of Finance Act 2014 (c. 26), Sch. 8 paras. 227(2), 232

[F11 421JA Annual returns U.K.

(1) This section applies in relation to a person who is (or has been) a responsible person (see section 421L) in relation to reportable events (see section 421K).

(2) The person must give to Her Majesty's Revenue and Customs (“HMRC”) a return for each tax year falling (wholly or partly) in the person's reportable event period.

(3) The person's “reportable event period” is the period—

(a) beginning when the first reportable event occurs in relation to which the person is a responsible person, and

(b) ending when the person will no longer be a responsible person in relation to reportable events.

(4) The return for a tax year must—

(a) contain, or be accompanied by, such information as HMRC may require, and

(b) be given on or before 6 July in the following tax year.

(5) The information which may be required under subsection (4)(a) includes (in particular) information to enable HMRC to determine the liability to tax, including capital gains tax, of any employee.

(6) If the person becomes aware that—

(a) anything which should have been included in, or should have accompanied, a return for a tax year was not included in, or did not accompany, the return,

(b) anything which should not have been included in, or should not have accompanied, a return for a tax year was included in, or accompanied, the return, or

(c) any other error or inaccuracy has occurred in relation to a return for a tax year,

the person must give an amended return correcting the position to HMRC without delay.

(7) A person's return for a tax year under this section need not contain, or be accompanied by, duplicate information and a person is not required to give a return for a tax year under this section if it would only contain, or be accompanied by, duplicate information.

(8) “Duplicate information” means information which is contained in or accompanies—

(a) a return which another person gives for the tax year under this section, or

(b) a return which any person gives for the tax year under any of the following provisions—

(i) paragraph 81B of Schedule 2 (annual return for Schedule 2 SIP);

(ii) paragraph 40B of Schedule 3 (annual return for Schedule 3 SAYE option scheme);

(iii) paragraph 28B of Schedule 4 (annual return for Schedule 4 CSOP scheme);

(iv) paragraph 52 of Schedule 5 (annual return for company whose shares are subject to qualifying options under the EMI code).

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421JB Returns to be given electronically U.K.

(1) A return under section 421JA, and any information accompanying the return, must be given electronically.

(2) But, if HMRC consider it appropriate to do so, HMRC may allow a person to give a return or any accompanying information in another way; and, if HMRC do so, the return or information must be given in that other way.

(3) The Commissioners for Her Majesty's Revenue and Customs—

(a) must prescribe how returns and accompanying information are to be given electronically;

(b) may make different provision for different cases or circumstances.

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421JC Penalties for late returns U.K.

(1) This section applies if a person fails to give a return under section 421JA for a tax year (containing, or accompanied by, all required information) on or before the date mentioned in section 421JA(4)(b) (“the date for delivery”).

(2) The person is liable for a penalty of £100.

(3) If the person's failure continues after the end of the period of 3 months beginning with the date for delivery, the person is liable for a further penalty of £300.

(4) If the person's failure continues after the end of the period of 6 months beginning with the date for delivery, the person is liable for a further penalty of £300.

(5) The person is liable for a further penalty under this subsection if—

(a) the person's failure continues after the end of the period of 9 months beginning with the date for delivery,

(b) HMRC decide that such a penalty should be payable, and

(c) HMRC give notice to the person specifying the period in respect of which the penalty is payable.

(The person may be liable for more than one penalty under this subsection.)

(6) The penalty under subsection (5) is £10 for each day that the failure continues during the period specified in the notice under subsection (5)(c).

(7) The period specified in the notice under subsection (5)(c)—

(a) may begin earlier than the date on which the notice is given, but

(b) may not begin until after the end of the period mentioned in subsection (5)(a) or, if relevant, the end of any period specified in any previous notice under subsection (5)(c) given in relation to the failure.

(8) Liability for a penalty under this section does not arise if the person satisfies HMRC (or, on an appeal under section 421JF, the tribunal) that there is a reasonable excuse for the person's failure.

(9) For the purposes of subsection (8)—

(a) an insufficiency of funds is not a reasonable excuse, unless 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 mentioned) person took reasonable care to avoid the failure, and

(c) where the person had a reasonable excuse for the failure but the excuse 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.

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421JD Penalty if information not given correctly U.K.

(1) This section applies if a return under section 421JA, or any information accompanying such a return—

(a) is given otherwise than in accordance with section 421JB, or

(b) contains a material inaccuracy—

(i) which is careless or deliberate, or

(ii) which is not corrected as required by section 421JA(6).

(2) The person in question is liable for a penalty of an amount decided by HMRC.

(3) The penalty must not exceed £5,000.

(4) For the purposes of subsection (1)(b)(i) an inaccuracy is careless if it is due to a failure by the person in question to take reasonable care.

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421JE Assessment of penalties U.K.

(1) This section applies if a person is liable for a penalty under section 421JC or 421JD.

(2) HMRC must assess the penalty and notify the person of the assessment.

(3) Subject to subsection (4), the assessment must be made no later than 12 months after the date on which the person becomes liable for the penalty.

(4) In the case of a penalty under section 421JD(1)(b), the assessment must be made no later than—

(a) 12 months after the date on which HMRC become aware of the inaccuracy, and

(b) 6 years after the date on which the person becomes liable for the penalty.

(5) A penalty payable under this Part must be paid—

(a) no later than 30 days after the date on which the notice under subsection (2) is given to the person, or

(b) if notice of appeal is given against the penalty under section 421JF(1) or (2), no later than 30 days after the date on which the appeal is determined or withdrawn.

(6) The penalty may be enforced as if it were income tax or, if the person is a company within the charge to corporation tax, corporation tax charged in an assessment and due and payable.

(7) Sections 100 to 103 of TMA 1970 do not apply to a penalty under section 421JC or 421JD.

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421JF Appeals U.K.

(1) A person may appeal against a decision of HMRC that the person is liable for a penalty under section 421JC or 421JD.

(2) A person may appeal against a decision of HMRC as to the amount of a penalty payable by the person under section 421JC or 421JD.

(3) Notice of appeal must be given to HMRC no later than 30 days after the date on which the notice under section 421JE(2) is given to the person.

(4) On an appeal under subsection (1) which is notified to the tribunal, the tribunal may affirm or cancel the decision.

(5) On an appeal under subsection (2) which is notified to the tribunal, the tribunal may—

(a) affirm the amount of the penalty decided, or

(b) substitute another amount for that amount.

(6) Subject to this section and section 421JE, the provisions of Part 5 of TMA 1970 relating to appeals have effect in relation to an appeal under this section as they have effect in relation to an appeal against an assessment to income tax or, if the person is a company within the charge to corporation tax, corporation tax.]

Textual Amendments

F11 Ss. 421JA-421JF inserted (with effect in accordance with Sch. 8 para. 234 of the amending Act) by Finance Act 2014 (c. 26), Sch. 8 paras. 228, 232

421K Reportable events U.K.

(1) This section applies for the purposes of [F12 sections 421J and 421JA (duties to provide information and annual returns)].

(2) Each of the events mentioned in subsection (3) is a reportable event.

(3) The events are—

(a) an acquisition (or an event treated as an acquisition) of securities, an interest in securities or a securities option pursuant to a right or opportunity available by reason of the employment of the person who acquires the securities, interest in securities or securities option or of any other person,

(b) an event which is a chargeable event in relation to securities, or an interest in securities, for the purposes of section 426 (chargeable events in relation to restricted securities and restricted interests in securities),

(c) an event which is a chargeable event in relation to securities, or an interest in securities, for the purposes of section 438 (chargeable events in relation to convertible securities and interests in convertible securities),

(d) the doing of anything which gives rise to a taxable amount counting as employment income under section 446L (artificial enhancement of market value of securities),

(e) an event which discharges a notional loan relating to securities, or an interest in securities, under section 446U (securities and interests in securities acquired for less than market value),

(f) a disposal of securities, or an interest in securities, by virtue of which Chapter 3D of this Part applies (securities and interests in securities disposed of for more than market value),

(g) the receipt of a benefit which gives rise to a taxable amount counting as employment income under section 447 (charge on benefit from securities or interest in securities) [F13 or would give rise to such an amount but for Chapter 4A (shares in research institution spin-out companies)],

(h) the assignment or release of a securities option acquired pursuant to a right or opportunity available by reason of the employment of the person who acquires the securities option or any other person, and

(i) the receipt of a benefit in money or money’s worth which is (or by virtue of section 477(6) is to be regarded as being) received in connection with such a securities option.

Textual Amendments

F12 Words in s. 421K(1) substituted (6.4.2014) by Finance Act 2014 (c. 26), Sch. 8 paras. 229, 232

F13 Words in s. 421K(3)(g) inserted (with effect in accordance with s. 20(5) of the amending Act) by Finance Act 2005 (c. 7), s. 20(4)

421L Persons to whom section 421J applies U.K.

(1) This section applies for the purposes of [F14 sections 421J and 421JA (duties to provide information and annual returns)] .

(2) Each of the following persons is a responsible person in relation to a reportable event.

(3) The persons are—

(a) the employer in question,

(b) any host employer of the employee in question,

[F15 (ba) if the employee in question is a continental shelf worker and PAYE regulations do not apply to the employer in question, any person who is a relevant person in relation to the employee in question,]

(c) the person from whom the securities in question were, or interest or option in question was, acquired, and

(d) in relation to a reportable event concerning securities or an interest in securities which are not excluded securities, the person by whom the securities were issued.

(4) In subsection (3)(b) “host employer” means a person other than the employer in question—

(a) for whom the employee in question works at the time of the reportable event, and

(b) who would, by virtue of subsection (2) of section 689 (employees of non-UK employers working for a person other than the employer), be treated for the purposes of PAYE regulations as making a payment of PAYE income of the employee in question if a payment to which subsection (5) would apply were made by the employer in question in respect of the period during which the employee works for the other person.

(5) For the purposes of subsection (4)(b) this subsection would apply to a payment if—

(a) it were a payment of PAYE income of the employee, and

(b) the conditions in subsection (1)(c) and (d) of section 689 were satisfied in relation to the payment.

[F16 (5A) In subsection (3)(ba) “continental shelf worker” and “relevant person” have the meaning given by section 689A(11) (PAYE: oil and gas workers on the continental shelf).]

(6) For the purposes of subsection (3)(d) securities are excluded securities in relation to a reportable event if they are—

(a) loan stock, bonds or other instruments creating or acknowledging indebtedness issued by or on behalf of any national or regional government or local authority (in the United Kingdom or elsewhere) or any body whose members consists of states, national or regional governments or local authorities, or

(b) securities which are issued by a person who, at the time of the reportable event, is not connected with the employer in question and which are listed [F17 on a recognised stock exchange or dealt in on any designated market in the United Kingdom].

[F18 (7) In subsection (6)(b) “designated” means designated by an order made by the Commissioners for Her Majesty's Revenue and Customs for the purposes of that provision.

(8) An order under subsection (7) may—

(a) designate a market by name or by reference to any class or description of market, and

(b) vary or revoke a previous order under that subsection.]]

Textual Amendments

F14 Words in s. 421L(1) substituted (6.4.2014) by Finance Act 2014 (c. 26), Sch. 8 paras. 230, 232

F15 S. 421L(3)(ba) inserted (17.7.2014) by Finance Act 2014 (c. 26), s. 21(3)(a)

F16 S. 421L(5A) inserted (17.7.2014) by Finance Act 2014 (c. 26), s. 21(3)(b)

F17 Words in s. 421L(6)(b) substituted (19.7.2007) by Finance Act 2007 (c. 11), Sch. 26 para. 10(2)(a)

F18 S. 421L(7)(8) inserted (19.7.2007) by Finance Act 2007 (c. 11), Sch. 26 para. 10(2)(b)