Reductions for disclosureU.K.
12[F1(1)Paragraph 13 provides for reductions in penalties—U.K.
(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.]
(2)P discloses [F2the] relevant act or failure by—
(a)telling HMRC about it,
(b)giving HMRC reasonable help in quantifying the tax unpaid by reason of it, and
(c)allowing HMRC access to records for the purpose of checking how much tax is so unpaid.
[F3(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.]
(3)Disclosure of a relevant act or failure—
(a)is “unprompted” if made at a time when the person making it has no reason to believe that HMRC have discovered or are about to discover the relevant act or failure, and
(b)otherwise, is “prompted”.
(4)In relation to disclosure “quality” includes timing, nature and extent.
[F4(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.]
Textual Amendments
F1Sch. 41 para. 12(1)-(1B) substituted for Sch. 41 para. 12(1) (with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 6(2); S.I. 2017/259, reg. 2
F2Word in Sch. 41 para. 12(2) substituted (with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 6(3); S.I. 2017/259, reg. 2
F3Sch. 41 para. 12(2A)-(2E) inserted (8.3.2017 for specified purposes and in so far as not already in force and with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 6(4); S.I. 2017/259, regs. 2, 3
F4Sch. 41 para. 12(5)(6) inserted (with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 6(5); S.I. 2017/259, reg. 2
Commencement Information
I1Sch. 41 para. 12 in force at 1.4.2010 with effect in accordance with art. 3 by S.I. 2009/511, art. 2
[F513(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.U.K.
(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—
(i)the penalty is one under paragraph 1, and
(ii)HMRC become aware of the failure less than 12 months after the time when the tax first becomes unpaid by reason of the failure, and
(b)otherwise, the case B minimum applies.
| [F6Standard % | 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%]] |
Textual Amendments
F5Sch. 41 para. 13 substituted (6.4.2011) by Finance Act 2010 (c. 13), s. 35(2), Sch. 10 para. 9; S.I. 2011/975, art. 2(1) (with art. 4)
F6Sch. 41 para. 13(3) Table substituted (with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 7; S.I. 2017/259, reg. 2
Commencement Information
I2Sch. 41 para. 13 in force at 1.4.2010 with effect in accordance with art. 3 by S.I. 2009/511, art. 2
[F713A(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.U.K.
(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%] |
Textual Amendments
F7Sch. 41 para. 13A inserted (with effect in accordance with reg. 2 of the commencing S.I.) by Finance Act 2016 (c. 24), s. 163(2), Sch. 21 para. 8; S.I. 2017/259, reg. 2