Finance Act 1985

for the words “of less than 15”, in each place where they occur, of the words “not exceeding 15”; and

for the words “of not less than 15” of the words “exceeding 15”.

enable the type of gaming machine licence which may be granted and the amount of duty payable thereon to be determined by reference to the value of the maximum prize obtainable by a successful player of the machine; and

to extend to Northern Ireland the provisions of the 1981 Act relating to gaming machine licence duty.

to produce, furnish or deliver any document, or cause any document to be produced, furnished or delivered, or

shall be entitled at any reasonable time to have access to, and inspect and check the operation of, any computer and any associated apparatus or material which is or has been in use in connection with any document to which this subsection applies; and

to produce, furnish or deliver, or cause to be produced, furnished or delivered; or

to permit the Commissioners or a person authorised by them to inspect, make or take extracts from or copies of or remove.

obstructs a person authorised under subsection (2) above in the exercise of his powers under paragraph (a) of that subsection, or

without reasonable excuse fails to comply within a reasonable time with a requirement under paragraph (b) of that subsection,

paragraph 4(1) of Schedule 1 to the M44Miscellaneous Transferred Excise Duties Act (Northern Ireland) 1972 (false statements and documents in connection with pool betting duty);

paragraph 8(1) of Schedule 2 to that Act (false statements and documents in connection with general betting duty);

section 167 of the M45Customs and Excise Management Act 1979 (untrue declarations etc.);

section 168 of that Act (counterfeit documents etc.);

section 15 of the M46Customs and Excise Duties (General Reliefs) Act 1979 (false statements and documents in connection with reliefs);

paragraph 13(3) of Schedule 1 to the M47Betting and Gaming Duties Act 1981 (false statements and documents in connection with betting duty);

paragraph 7(3) of Schedule 2 to that Act (false statements and documents in connection with gaming licence duty);

paragraph 8(2) of Schedule 1 to the M48Car Tax Act 1983 (false documents etc.).

in the case of Scotland, as references to Part III of the M50Law Reform (Miscellaneous Provisions) (Scotland) Act 1968 and section 17(4) of that Act respectively, and

in the case of Northern Ireland, as references to Part I of the M51Civil Evidence Act (Northern Ireland) 1971 and section 6(2) of that Act respectively.

in subsection (5), paragraph (a) and the words from “or, if greater” onwards;

subsection (6); and

subsection (7).

for the words “the failure referred to in subsection (7) above” there shall be substituted “a person’s failure to comply with any regulations made under this Act”; and

for the words from “that subsection” to “(if it is greater)” there shall be substituted “that person shall be liable on summary conviction to a penalty of level 3 on the standard scale, together with a penalty of whichever is the greater of £10 and”;

for the purpose of evading tax, a person does any act or omits to take any action, and

his conduct involves dishonesty (whether or not it is such as to give rise to criminal liability),

a payment under section 14(5) of the principal Act,

a refund under section 21 or section 22 of that Act, . . . F22

a repayment under section 23 of that Act, F23and

a refund under section 11 of the Finance Act 1990,

in relation to tax itself or a payment under section 14(5) of the principal Act, as a reference to the aggregate of the amount (if any) falsely claimed by way of credit for input tax and the amount (if any) by which output tax was falsely understated; and

in relation to the sums referred to in paragraphs (b) and (c) of subsection (2) above, as a reference to the amount falsely claimed by way of refund or repayment.

that, in relation to tax, the Commissioners may assess an amount due by way of a civil penalty instead of instituting criminal proceedings and, though no undertaking can be given as to whether the Commissioners will make such an assessment in the case of any person, it is their practice to be influenced by the fact that a person has made a full confession of any dishonest conduct to which he has been a party and has given full facilities for investigation, and

that the Commissioners or, on appeal, a value added tax tribunal have power to reduce a penalty under this section, as provided in subsection (4) above, and, in determining the extent of such a reduction in the case of any person, the Commissioners or tribunal will have regard to the extent of the cooperation which he has given to the Commissioners in their investigation,

any criminal proceedings against the person concerned in respect of any offence in connection with or in relation to tax, and

any proceedings against him for the recovery of any sum due from him in connection with or in relation to tax.

the certificate is incorrect,

a return is made which understates a person’s liability to tax or overstates his entitlement to a payment under section 14(5) of the principal Act, or

an assessment is made which understates a person’s liability to tax and, at the end of the period of thirty days beginning on the date of the assessment, he has not taken all such steps as are reasonable to draw the understatement to the attention of the Commissioners,

equals or exceeds 30 per cent. of the true amount of tax for that period, or

equals or exceeds whichever is the greater of £10,000 and 5 per cent. of the true amount of tax for that period.

the amount (if any) by which credit for input tax for that period was overstated; and

the amount (if any) by which output tax for that period was understated;

a return for any prescribed accounting period overstates or understates to any extent a person’s liability to tax or his entitlement to a payment under section 14(5) of the principal Act, and

that return is corrected, in such circumstances and in accordance with such conditions as may be prescribed, by a return for a later such period which understates or overstates, to the corresponding extent, that liability or entitlement,

any reference to a payment under section 14(5) of that Act included a reference to a refund under the said section 20, and

any reference to credit for input tax included a reference to tax chargeable on supplies or importations which were not for the purposes of any business carried on by the body.

the person concerned satisfies the Comissioners or, on appeal, a value added tax tribunal that there is a reasonable excuse for the conduct, or

at a time when he had no reason to believe that enquiries were being made by the Commissioners into his affairs, so far as they relate to tax, the person concerned furnished to the Commissioners full information with respect to the inaccuracy concerned.

a person is convicted of an offence (whether under the principal Act or otherwise), or

a person is assessed to a penalty under section 13 above,

for a prescribed accounting period (including one beginning before the commencement of this section), a return has been made which understates a person’s liability to tax or overstates his entitlement to a payment under section 14(5) of the principal Act; and

the tax for that period which would have been lost if the inaccuracy had not been discovered equals or exceeds whichever is the greater of £100 and 1 per cent. of the true amount of tax for that period,

there is a material inaccuracy in respect of any two prescribed accounting periods; and

the last day of the later one of those periods falls on or before the second anniversary of the last day of the earlier one; and

after the coming into operation of this section, the Commissioners serve notice on the person concerned (in this section referred to as “a penalty liability notice”) specifying as a penalty period for the purposes of this section a period beginning on the date of the notice and ending on the second anniversary of that date.

the person concerned satisfies the Commissioners or, on appeal, a value added tax tribunal that there is a reasonable excuse for the inaccuracy; or

at a time when he had no reason to believe that enquiries were being made by the Commissioners into his affairs, so far as they relate to tax, the person concerned furnished to the Commissioners full information with respect to the inaccuracy.

a person is convicted of an offence (whether under the principal Act or otherwise); or

a person is assessed to a penalty under section 13 or 14 above,

an EC sales statement containing a material inaccuracy has been submitted by any person to the Commissioners;

the Commissioners have, within six months of discovering the inaccuracy, issued that person with a written warning identifying that statement and stating that future inaccuracies might result in the service of a notice for the purposes of this section;

another EC sales statement containing a material inaccuracy (“the second inaccurate statement”) has been submitted by that person to the Commissioners;

the submission date for the second inaccurate statement fell within the period of two years beginning with the day after the warning was issued;

the Commissioners have, within six months of discovering the inaccuracy in the second inaccurate statement, served that person with a notice identifying that statement and stating that future inaccuracies will attract a penalty under this section;

yet another EC sales statement containing a material inaccuracy is submitted by that person to the Commissioners; and

the submission date for the statement falling within paragraph (f) above is not more than two years after the service of the notice or the date on which any previous statement attracting a penalty was submitted by that person to the Commissioners,

the person who submitted the statement satisfies the Commissioners or, on appeal, a value added tax tribunal that there is a reasonable excuse for the inaccuracy; or

at a time when he had no reason to believe that enquiries were being made by the Commissioners into his affairs, that person furnished the Commissioners with full information with respect to the inaccuracy.

a person fails to comply with any of paragraphs 3, 4 and 11(2) F32and (3) of Schedule 1 to the principal Act (duty to notify liability for registration or change in nature of supplies etc. by a person exempted from registration), or

an unauthorised person issues F33one or more invoices showing an amount as being tax or as including an amount attributable to tax.

a person registered under the principal Act; or

a body corporate treated for the purposes of section 29 of that Act as a member of a group; or

a person treated as a taxable person under regulations made under section 31(4) of that Act; or

a person authorised to issue an invoice under regulations made under paragraph 2(6) of Schedule 7 to that Act; or

a person acting on behalf of the Crown.

in relation to a person’s failure to comply with paragraph 3 or paragraph 4 of Schedule 1 to the principal Act, the tax (if any) for which he is liable for the period beginning on the date with effect from which he is, in accordance with that paragraph, required to be registered and ending on that date on which the Commissioners received notification of, or otherwise F35became fully aware of, his liability to be registered; and

in relation to a person’s failure to comply with subparagraph (2) F36or (3) of paragraph 11 of Schedule 1 to the principal Act, the tax (if any) for which, but for any exemption from registration, he would be liable for the period beginning on the date of the change or alteration referred to in that subparagraph and ending on the date on which the Commissioners received notification of, or otherwise F37became fully aware of, that change or alteration; and

10 per cent. where the relevant tax is given by paragraph (a) or (b) of subsection (3) above and the period referred to in that paragraph does not exceed nine months;

20 per cent. where that tax is so given and the period soreferred to exceeds nine months but does not exceed eighteen months; and

30 per cent. in any other case.

a person is convicted of an offence (whether under the principal Act or otherwise), or

a person is assessed to a penalty under section 13 above,

the insufficiency of the funds available to any person for paying any tax due or for paying the amount of the penalty;

the fact that there has, in the case in question or in that case taken with any other cases, been no or no significant loss of tax;

the fact that the person liable to the penalty or a person acting on his behalf has acted in good faith.

in accordance with regulations under paragraph 6(4) of Schedule 7 to the principal Act, a distress is authorised to be levied on the goods and chattels of a person (in this section referred to as a “person in default”) who has refused or neglected to pay any tax due or any amount recoverable as if it were tax due; and

the person levying the distress and the person in default have entered into a walking possession agreement, as defined in subsection (2) below.

acknowledges that the property specified in the agreement is under distraint and held in walking possession; and

undertakes that, except with the consent of the Commissioners and subject to such conditions as they may impose, he will not remove or allow the removal of any of the specified property from the premises named in the agreement.

paragraph 7 F41or 7A of Schedule 1 to the principal Act F42(notification of end of liability or entitlement to be registered etc.), or

paragraph 7(1) or paragraph 8 of Schedule 7 to that Act (records and information, etc.), or

any regulations or rules made under that Act, other than rules made under paragraph 9 of Schedule 8 thereto (procedural rules for tribunals), F43or

any order made by the Treasury under that Act; or

any regulations made under the European Communities Act 1972 and relating to value added tax

if there has been no such previous occasion in that period, F45£5;

if there has been only one such occasion in that period, F45£10; and

in any other case, F45£15.

a failure to comply with any such requirement as is referred to in subsection (1) above shall be disregarded if, as a result of the failure, the person concerned became liable for a surcharge under section 19 below;

a previous failure to comply with any such requirement shall be disregarded if it occurred before the passing of this Act F46or, in the case of a requirement falling within paragraph (d) or paragraph (e) of subsection (1) above, before the passing of the Finance Act 1986;

a continuing failure to comply with any such requirement shall be regarded as one occasion of failure occurring on the date on which the failure began;

if the same omission gives rise to a failure to comply with more than one such requirement, it shall nevertheless be regarded as the occasion of only one failure; and

in relation to a failure to comply with a requirement imposed by regulations as to the furnishing of a return or as to the payment of tax, a previous failure to comply with such a requirement as to either of those matters shall be regarded as a previous failure to comply with the requirement in question.

in not paying the tax due in respect of any period within the time required by regulations under section 14(1) of the principal Act, or

in not furnishing a return in respect of any period within the time required by regulations under paragraph 2(1) of Schedule 7 to that Act,

if the person concerned has furnished a return, shall be taken to be the tax shown in the return as that for which he is accountable in respect of the period in question, and

in any other case, shall be taken to be such tax as has been assessed for that period and notified to him under paragraph 4(1) of Schedule 7 to the principal Act.

a person is convicted of an offence (whether under the principal Act or otherwise),or

a person is asssessed to a penalty under section 13 or section 14 above, or

a person is assessed to a surcharge under section 19 below,

that he is in default in relation to the statement specified in the notice;

that (subject to the liability mentioned in paragraph (d) below) no action will be taken if he remedies the default before the end of the period of fourteen days beginning with the day after the service of the notice;

that if the default is not so remedied, that person will become liable in respect of his default to penalties calculated on a daily basis from the end of that period in accordance with the following provisions of this section; and

that that person will become liable, without any further notices being served under this section, to penalties under this section if he commits any more defaults before a period of twelve months has elapsed without his being in default.

if the statement to which the notice relates is not submitted before the end of the period of fourteen days beginning with the day after the service of the notice, to a penalty in respect of that statement; and

whether or not that statement is so submitted, to a penalty in respect of any EC sales statement the last day for the submission of which is after the service and before the expiry of the notice and in relation to which he is in default.

except in a case falling within paragraph (b) below, until the end of the period of twelve months beginning with the day after the service of the notice; and

where at any time in that period of twelve months that person is in default in relation to any EC sales statement other than one in relation to which he was in default when the notice was served, until a period of twelve months has elapsed without that person becoming liable to a penalty under this section in respect of any EC sales statement.

in the case of a liability in respect of the statement to which the notice relates, a penalty of £5 for every day for which the default continues after the end of the period of fourteen days mentioned in subsection (3)(a) above, up to a maximum of one hundred days; and

in the case of a liability in respect of any other statement, a penalty of the relevant amount for every day for which the default continues, up to a maximum of one hundred days.

£5, where (that person not having been liable to a penalty under this section in respect of the statement to which the notice relates) the statement in question is the first statement in respect of which that person has become liable to a penalty while the notice has been in force;

£10, where the statement in question is the second statement in respect of which he has become so liable while the notice has been in force (counting the statement to which the notice relates where he has become liable in respect of that statement); and

£15, in any other case.

an EC sales statement has been submitted at such a time and in such a manner that it was reasonable to expect that it would be received by the Commissioners within the appropriate time limit; or

there is a reasonable excuse for such a statement not having been dispatched,

the assessment relates to a prescribed accounting period which exceeds three months and begins on the date with effect from which the person concerned was, or was required to be, registered,

the assessment relates to a prescribed accounting period at the beginning of which the person concerned was, but should no longer have been, exempted from registration under F50paragraph 11(1) of Schedule 1 to the principal Act,

the circumstances are such that an assessment falling within subsection (1) above could have been made, but

before such an assessment was made the tax due or other amount concerned was paid (so that no such assessment was necessary),

where the amount assessed or paid is such an amount as is referred to in subparagraph (2)(a) or subparagraph (2)(b) of paragraph 4 of Schedule 7 to the principal Act (incorrect repayment of tax or payment in respect of excess credit), the reckonable date is the seventh day after the day on which a written instruction was issued by the Commissioners directing the making of the payment of the amount which ought not to have been repaid or paid to the person concerned; and

in all other cases the reckonable date is the latest date on which (in accordance with regulations under the principal Act) a return is required to be made for the prescribed accounting period to which the amount assessed or paid relates; and

in the case of an amount assessed under paragraph 4(6) of Schedule 7 to the principal Act (assessments in respect of goods which cannot be accounted for) the sum assessed shall be taken for the purposes of paragraph (b) above to relate to the period for which the assessment was made;

may prescribe different rates for different purposes;

shall apply to interest for periods beginning on or after the date when the order is expressed to come into force, whether or not interest runs from before that date; and

shall be made by statutory instrument which shall be subject to annulment in pursuance of a resolution of the Commons House of Parliament.

the Commissioners have not received that return, or

the Commissioners have received that return but have not received the amount of tax shown on the return as payable by him in respect of that period,

a taxable person is in default in respect of any two prescribed accounting periods; and

the last day of the later one of those periods falls on or before the first anniversary of the last day of the earlier one; and

the Commissioners serve notice on the taxable person (in this section referred to as a “surcharge liability notice”) specifying as a surcharge period for the purposes of this section a period ending on the first anniversary of the last day of the later period referred to in paragraph (b) above and beginning, subject to subsection (3) below, on the date of the notice.

the specified percentage of his outstanding tax for that period; and

£30;

in relation to the first such prescribed accounting period, the specified percentage is 5 per cent.;

in relation to the second such period, the specified percentage is 10 per cent.; and

in relation to each subsequent such period the specified percentage is increased by a further 5 per cent. up to a maximum of 30 per cent. for the sixth and any later period.

the return or, as the case may be, the tax shown on the return was despatched at such a time and in such a manner that it was reasonable to expect that it would be received by the Commissioners within the appropriate time limit, or

there is a reasonable excuse for the return or tax not having been so despatched,

it is the default which, by virtue of subsection (4) above, gives rise to the surcharge; or

it is a default which was taken into account in the service of the surcharge liability notice upon which the surcharge depends and the person concerned has not previously been liable to a surcharge in respect of a prescribed accounting period ending within the surcharge period specified in or extended by that notice.

the conduct by virtue of which a person is in default in respect of a prescribed accounting period is also conduct falling within subsection (1) of section 17 above, and

by reason of that conduct, the person concerned is assessed to a penalty under that section,

a person is entitled to a payment under section 14(5) of the principal Act, or

a body which is registered and to which section 20 of that Act applies is entitled to a refund under that section,

that the requisite return or claim is received by the Commissioners not later than one month after the last day on which it is required to be furnished or made, and

that a written instruction directing the making of the payment or refund is not issued by the Commissioners within the period of thirty days beginning on the date of the receipt by the Commissioners of that return or claim, and

that the amount shown on that return or claim as due by way of payment or refund does not exceed the payment or refund which was in fact due by more than 5 per cent. of that payment or refund or £250, whichever is the greater.

the raising and answering of any reasonable inquiry relating to the requisite return or claim,

the correction by the Commissioners of any errors or omissions in that return or claim, and

a supplement paid to any person under subsection (1)(a) above shall be treated as an amount due to him by way of credit under section 14(5) of the principal Act, and

a supplement paid to any body under subsection (1)(b) above shall be treated as an amount due to it by way of refund under section 20 of that Act.

in relation to a payment, the return for the prescribed accounting period concerned which is required to be furnished in accordance with regulations under the principal Act, and

in relation to a refund, the claim for that refund which is required to be made in accordance with the Commissioners’ determination under section 20 of that Act.

to a penalty under any of sections 13 to 17 above, or

for interest under section 18 above, or

to a surcharge under section 19 above,

in the case of a penalty under section 13 above relating to the evasion of tax, the relevant period is the prescribed accounting period for which the tax evaded was due;

in the case of a penalty under section 13 above relating to the obtaining of a payment under section 14(5) of the principal Act, the relevant period is the prescribed accounting period in respect of which the payment was obtained;

in the case of a penalty under section 14 above, the relevant period is the prescribed accounting period for which liability to tax was understated or, as the case may be, for which entitlement to a payment under section 14(5) of the principal Act was overstated;

in the case of interest under section 18 above, the relevant period is the prescribed accounting period in respect of which the tax (or amount assessed as tax) was due; and

in the case of a surcharge under section 19 above, the relevant period is the prescribed accounting period in respect of which the taxable person is in default and in respect of which the surcharge arises.

a notice of assessment under this section shall specify a date, being not later than the date of the notice, to which the aggregrate amount of the penalty or, as the case may be, the amount of interest which is assessed is calculated; and

if the penalty or interest continues to accrue after that date, a further assessment or assessments may be made under this section in respect of amounts which so accrue.

a failure falling within section 17(1) above is remedied, or

the tax or other amount referred to in section 18(1) above is paid,

under any provision of paragraph 4 of Schedule 7 to the principal Act, or

under section 21 above,

as a result of conduct falling within section 13(1) above or for which a person has been convicted of fraud, or

in circumstances giving rise to liability to a penalty under section 15 above,

the assessment shall not be made more than three years after the death; and

if the circumstances are as set out in subsection (4) above, the modification of subsection (1) above contained in that subsection shall not apply but any assessment which (from the point of view of time limits) could have been made immediately after the death may be made at any time within three years after it.

under the like provision as that assessment was made, and

on or before the last day on which that assessment could have been made,

as upheld without variation, or

as varied in a particular manner, or

as discharged or cancelled,

the preceding provisions of this section shall not apply unless the fact that an agreement was come to, and the terms agreed, are confirmed by notice in writing given by the Commissioners to the appellant or by the appellant to the Commissioners; and

referrences in those provisions to the time when the agreement was come to shall be construed as references to the time of the giving of that notice of confirmation.

a person who has given a notice of appeal notifies the Commissioners, whether orally or in writing, that he desires not to proceed with the appeal; and

thirty days have elapsed since the giving of the notification without the Commissioners giving to the appellant notice in writing indicating that they are unwilling that the appeal should be treated as withdrawn,

in such classes of appeal as may be prescribed by the order, and

subject to the consent of the parties and to such other conditions as may be so prescribed,

may provide that section 13 of the M54Tribunals and Inquiries Act 1971 (which provides for appeals to the High Court from, among other tribunals, a value added tax tribunal) shall have effect, in relation to any appeal to which the order applies, with such modifications as may be specified in the order; and

shall be made by statutory instrument subject to annulment in pursuance of a resolution of either House of Parliament.

after the words “on appeals to” there shall be inserted “and in other proceedings before”;

in paragraph (d) the words “and produce documents” shall be omitted;

at the end of paragraph (d) there shall be inserted the following paragraph—

at the end of paragraph (e) there shall be added the words “or producing documents”.

the power to make rules under paragraph 9 of Schedule 8 to the principal Act shall be exercisable by the Lord Chancellor, after consultation with the Lord Advocate, instead of by the Commissioners;

any rules under that paragraph which are in force immediately before the day appointed under this subsection shall have effect as if made as mentioned in paragraph (a) above; and

a statutory instrument by which the power referred to in paragraph (a) above is exercised shall be subject to annulment in pursuance of a resolution of either House of Parliament.

any amount which, as a result of the decision, is, or is recoverable as, tax due from any person, and

any costs awarded to the Commissioners by the decision,

confirms or varies an amount which is, or is recoverable as, tax due from any person, or

awards costs to the Commissioners,

any amount is, or is recoverable as, tax due from any person, as a result of the decision, whether with or without an award of costs to the Commissioners; or

any costs are awarded to the Commissioners by the decision.

payment of the amount mentioned in paragraph (a) of subsection 3 above or, as the case may be, the amount of the costs mentioned in paragraph (b) of that subsection may be enforced by the Enforcement of Judgments Office; and

a sum equal to any such amount shall be deemed to be payable under a money judgment within the meaning of Article 2(2) of the M55Judgments Enforcement (Northern Ireland) Order 1981, and the provisions of that order shall apply accordingly.

an insufficiency of funds to pay any tax due is not a reasonable excuse; and

where reliance is placed on any other person to perform any task, neither the fact of that reliance nor any dilatoriness or inaccuracy on the part of the person relied upon is a reasonable excuse.

references in section 39(9) of that Act (application of certain provisions to offences and penalties) to penalties do not include references to penalties under sections 13 to 17 above; and

section 45 of that Act (orders, rules and regulations) does not apply in relation to orders under any provision of this Chapter.