Finance (No. 3) Act 2010

7 U.K. After paragraph 13 insert—

“Amount of penalty: returns for periods of between 2 and 6 months U.K.

13A (1) Paragraphs 13B to 13E apply in the case of a return falling within any of items [F1 7A to 7B] [F2 , 13A] [F3 , 13B] and 14 to 28 in the Table which relates to a period of less than 6 months but more than 2 months.

(2) But those paragraphs do not apply in the case of a return mentioned in paragraph 2(1)(c).

13B (1) P is liable to a penalty under this paragraph of £100.

(2) In addition, a penalty period begins to run on the penalty date for the return.

(3) The penalty period ends with the day 12 months after the filing date for the return, unless it is extended under paragraph 13C(2)(c) or 13H(2)(c).

13C (1) This paragraph applies if—

(a) a penalty period has begun under paragraph 13B or 13G because P has failed to make a return (“return A”), and

(b) before the end of the period, P fails to make another return (“return B”) falling within the same item in the Table as return A.

(2) In such a case—

(a) paragraph 13B(1) and (2) do not apply to the failure to make return B, but

(b) P is liable to a penalty under this paragraph for that failure, and

(c) the penalty period that has begun is extended so that it ends with the day 12 months after the filing date for return B.

(3) The amount of the penalty under this paragraph is determined by reference to the number of returns that P has failed to make during the penalty period.

(4) If the failure to make return B is P's first failure to make a return during the penalty period, P is liable, at the time of the failure, to a penalty of £200.

(5) If the failure to make return B is P's second failure to make a return during the penalty period, P is liable, at the time of the failure, to a penalty of £300.

(6) If the failure to make return B is P's third or a subsequent failure to make a return during the penalty period, P is liable, at the time of the failure, to a penalty of £400.

(7) For the purposes of this paragraph—

(a) in accordance with sub-paragraph (1)(b), the references in sub-paragraphs (3) to (6) to a return are references to a return falling within the same item in the Table as returns A and B, and

(b) a failure to make a return counts for the purposes of those sub-paragraphs if (but only if) the return relates to a period of less than 6 months.

(8) A penalty period may be extended more than once under sub-paragraph (2)(c).

13D (1) P is liable to a penalty under this paragraph if (and only if) P's failure continues after the end of the period of 6 months beginning with the penalty date.

(2) The penalty under this paragraph is the greater of—

(a) 5% of any liability to tax which would have been shown in the return in question, and

(b) £300.

13E (1) P is liable to a penalty under this paragraph if (and only if) P's failure continues after the end of the period of 12 months beginning with the penalty date.

(2) Where, by failing to make the return, P deliberately withholds information which would enable or assist HMRC to assess P's liability to tax, the penalty under this paragraph is determined in accordance with sub-paragraphs (3) and (4).

(3) If the withholding of the information is deliberate and concealed, the penalty is the greater of—

(a) 100% of any liability to tax which would have been shown in the return in question, and

(b) £300.

(4) If the withholding of the information is deliberate but not concealed, the penalty is the greater of—

(a) 70% of any liability to tax which would have been shown in the return in question, and

(b) £300.

(5) In any case not falling within sub-paragraph (2), the penalty under this paragraph is the greater of—

(a) 5% of any liability to tax which would have been shown in the return in question, and

(b) £300.

Amount of penalty: returns for periods of 2 months or less U.K.

13F (1) Paragraphs 13G to 13J apply in the case of a return falling within any of items 7A, 7B and 14 to 28 in the Table which relates to a period of 2 months or less.

(2) But those paragraphs do not apply in the case of a return mentioned in paragraph 2(1)(c).

13G (1) P is liable to a penalty under this paragraph of £100.

(2) In addition, a penalty period begins to run on the penalty date for the return.

(3) The penalty period ends with the day 12 months after the filing date for the return, unless it is extended under paragraph 13C(2)(c) or 13H(2)(c).

13H (1) This paragraph applies if—

(a) a penalty period has begun under paragraph 13B or 13G because P has failed to make a return (“return A”), and

(b) before the end of the period, P fails to make another return (“return B”) falling within the same item in the Table as return A.

(2) In such a case—

(a) paragraph 13G(1) and (2) do not apply to the failure to make return B, but

(b) P is liable to a penalty under this paragraph for that failure, and

(c) the penalty period that has begun is extended so that it ends with the day 12 months after the filing date for return B.

(3) The amount of the penalty under this paragraph is determined by reference to the number of returns that P has failed to make during the penalty period.

(4) If the failure to make return B is P's first, second, third, fourth or fifth failure to make a return during the penalty period, P is liable, at the time of the failure, to a penalty of £100.

(5) If the failure to make return B is P's sixth or a subsequent failure to make a return during the penalty period, P is liable, at the time of the failure, to a penalty of £200.

(6) For the purposes of this paragraph—

(a) in accordance with sub-paragraph (1)(b), the references in sub-paragraphs (3) to (5) to a return are references to a return falling within the same item in the Table as returns A and B, and

(b) a failure to make a return counts for the purposes of those sub-paragraphs if (but only if) the return relates to a period of less than 6 months.

(7) A penalty period may be extended more than once under sub-paragraph (2)(c).

13I (1) P is liable to a penalty under this paragraph if (and only if) P's failure continues after the end of the period of 6 months beginning with the penalty date.

(2) The penalty under this paragraph is the greater of—

(a) 5% of any liability to tax which would have been shown in the return in question, and

(b) £300.

13J (1) P is liable to a penalty under this paragraph if (and only if) P's failure continues after the end of the period of 12 months beginning with the penalty date.

(2) Where, by failing to make the return, P deliberately withholds information which would enable or assist HMRC to assess P's liability to tax, the penalty under this paragraph is determined in accordance with sub-paragraphs (3) and (4).

(3) If the withholding of the information is deliberate and concealed, the penalty is the greater of—

(a) 100% of any liability to tax which would have been shown in the return in question, and

(b) £300.

(4) If the withholding of the information is deliberate but not concealed, the penalty is the greater of—

(a) 70% of any liability to tax which would have been shown in the return in question, and

(b) £300.

(5) In any case not falling within sub-paragraph (2), the penalty under this paragraph is the greater of—

(a) 5% of any liability to tax which would have been shown in the return in question, and

(b) £300.”

Textual Amendments

F1 Words in Sch. 10 para. 7 substituted (17.7.2014) by Finance Act 2014 (c. 26), Sch. 22 para. 21(3)

F2 Word in Sch. 10 para. 7 inserted (12.2.2019) by Finance Act 2019 (c. 1), s. 67(1) (with s. 67(2))

F3 Word in Sch. 10 para. 7 inserted (1.4.2022 and with effect in accordance with s. 85(1)(b) of the amending Act) by Finance Act 2021 (c. 26), s. 85(1)(a), Sch. 15 para. 3(1); S.I. 2021/1409, reg. 4

Commencement Information

I1 Amendments made by Sch. 10 para. 7 in force at 12.2.2019 for specified purposes by 2019 c. 1, s. 67(2)

I2 Amendments made by Sch. 10 para. 7 in force at 1.4.2022 for specified purposes by Finance Act 2021 (c. 26), Sch. 15 para. 3(2)