Finance Act 2016

Amendments to Schedule 41 to the Finance Act 2008 (c. 9) U.K.

5 U.K. Schedule 41 to FA 2008 (penalties: failure to notify etc) is amended as follows.

Commencement Information

I1 Sch. 21 para. 5 in force at 1.4.2017 with effect in accordance with reg. 2 by S.I. 2017/259, reg. 2

6 (1) Paragraph 12 (reductions for disclosure) is amended as follows. U.K.

(2) For sub-paragraph (1) substitute—

“(1) Paragraph 13 provides for reductions in penalties—

(a) under paragraph 1 where P discloses a relevant failure that involves a domestic matter, and

(b) under paragraphs 2 to 4 where P discloses a relevant act or failure.

(1A) Paragraph 13A provides for reductions in penalties under paragraph 1 where P discloses a relevant failure that involves an offshore matter or an offshore transfer.

(1B) Sub-paragraph (2) applies where P discloses—

(a) a relevant failure that involves a domestic matter,

(b) a non-deliberate relevant failure that involves an offshore matter, or

(c) a relevant act or failure giving rise to a penalty under any of paragraphs 2 to 4.”

(3) In sub-paragraph (2), for “a” substitute “ the ”.

(4) After sub-paragraph (2) insert—

“(2A) Sub-paragraph (2B) applies where P discloses—

(a) a deliberate relevant failure (whether concealed or not) that involves an offshore matter, or

(b) a relevant failure that involves an offshore transfer.

(2B) P discloses the failure by—

(a) telling HMRC about it,

(b) giving HMRC reasonable help in quantifying the tax unpaid by reason of it,

(c) allowing HMRC access to records for the purpose of checking how much tax is so unpaid, and

(d) providing HMRC with additional information.

(2C) The Treasury must make regulations setting out what is meant by “additional information” for the purposes of sub-paragraph (2B)(d).

(2D) Regulations under sub-paragraph (2C) are to be made by statutory instrument.

(2E) An instrument containing regulations under sub-paragraph (2C) is subject to annulment in pursuance of a resolution of the House of Commons.”

(5) At the end insert—

“(5) Paragraph 6A(4) to (5) applies to determine whether a failure involves an offshore matter, an offshore transfer or a domestic matter for the purposes of this paragraph.

(6) In this paragraph “relevant failure” means a failure to comply with a relevant obligation.”

Commencement Information

I2 Sch. 21 para. 6(1)-(3) (5) in force at 1.4.2017 with effect in accordance with reg. 2 by S.I. 2017/259, reg. 2

I3 Sch. 21 para. 6(4) in force at 8.3.2017 for specified purposes by S.I. 2017/259, reg. 3

I4 Sch. 21 para. 6(4) in force at 1.4.2017 in so far as not already in force and with effect in accordance with reg. 2 of the commencing S.I. by S.I. 2017/259, reg. 2

7 U.K. In paragraph 13 (amount of reduction for disclosure), for the Table in sub-paragraph (3) substitute—

“Standard %	Minimum % for prompted disclosure	Minimum % for unprompted disclosure
30%	case A: 10% case B: 20%	case A: 0% case B: 10%
70%	35%	20%
100%	50%	30%”

Commencement Information

I5 Sch. 21 para. 7 in force at 1.4.2017 with effect in accordance with reg. 2 by S.I. 2017/259, reg. 2

8 U.K. After paragraph 13 insert—

“13A (1) If a person who would otherwise be liable to a penalty of a percentage shown in column 1 of the Table (a “standard percentage”) has made a disclosure, HMRC must reduce the standard percentage to one that reflects the quality of the disclosure.

(2) But the standard percentage may not be reduced to a percentage that is below the minimum shown for it—

(a) for a prompted disclosure, in column 2 of the Table, and

(b) for an unprompted disclosure, in column 3 of the Table.

(3) Where the Table shows a different minimum for case A and case B—

(a) the case A minimum applies if HMRC becomes aware of the failure less than 12 months after the time when the tax first becomes unpaid by reason of the failure;

(b) otherwise, the case B minimum applies.

Standard %	Minimum % for prompted disclosure	Minimum % for unprompted disclosure
30%	case A: 10% case B: 20%	case A: 0% case B: 10%
37.5%	case A: 12.5% case B: 25%	case A: 0% case B: 12.5%
45%	case A: 15% case B: 30%	case A: 0% case B:15%
60%	case A: 20% case B: 40%	case A: 0% case B: 20%
70%	45%	30%
87.5%	53.75%	35%
100%	60%	40%
105%	62.5%	40%
125%	72.5%	50%
140%	80%	50%
150%	85%	55%
200%	110%	70%”

Commencement Information

I6 Sch. 21 para. 8 in force at 1.4.2017 with effect in accordance with reg. 2 by S.I. 2017/259, reg. 2