Details of the Schedule
3.Paragraph 2 amends Section 237 Finance Act 2014.
4.Paragraph 2(2) inserts new subsection (1A). The new subsection widens the circumstances in which an authorised officer in HMRC has a duty to give a conduct notice to a person carrying on a business as a promoter of tax avoidance schemes. The subsection extends the duty to include when the officer becomes aware that a person has met a threshold condition within the last three years and another person in business as a promoter is treated as meeting that threshold condition by virtue of the associations set out in Part 2 Schedule 34 Finance Act 2014 (as amended by paragraph 4 of this Schedule).
5.Paragraph 2(3) amends subsection (3) so that it refers to the treating of another person as meeting a threshold condition in line with the amendments paragraph 4 of this Schedule makes to Part 2 of Schedule 34 to Finance Act 2014.
6.Paragraph 2(4) modifies the significance test applied when considering issuing a conduct notice to a promoter in cases where a person other than that promoter actually met a threshold condition. An authorised officer must determine that the meeting of the condition should be regarded as significant in relation to giving that conduct notice by reference to both the person who met the condition and to the person who is treated as meeting that condition.
7.Paragraph 2(5) makes a consequential amendment to subsection (7).
8.Paragraph 2(6) inserts new subsection (7A) to allow for the meeting of a threshold condition by another person pursuant to Part 2 of Schedule 34.
9.Paragraph 2(7) makes a consequential amendment to subsection (9).
10.Paragraph 2(8) inserts new subsection (10). It provides that it is possible for an authorised officer to give a conduct notice both to a promoter, who has met a threshold condition, and to another promoter who is treated as meeting the threshold condition that the former promoter actually met.
11.Paragraph 3 makes a consequential amendment to the definition of conduct notice in section 283.
12.Paragraph 4 amends Part 2 of Schedule 34 Finance Act 2014.
13.Paragraph 4(3) replaces existing paragraph 13 with new paragraphs 13A, 13B, 13C and 13D.
14.New paragraph 13A contains the definition of terms for the purposes of this Part of the Schedule.
15.New paragraph 13B sets out the circumstances in which a relevant body can be treated as meeting a threshold condition by virtue of a person who controls the relevant body meeting that threshold condition in the last 3 years. This includes where either the relevant body in question, or the person who controls them, was carrying on a business as a promoter at that earlier time. This also includes circumstances in which the relevant body to which the meeting of a threshold condition is being attributed did not exist at the earlier time.
16.New paragraph 13C sets out the circumstances in which a person (other than an individual) can be treated as meeting a threshold condition by virtue of a relevant body, which that person controlled at that time, meeting a threshold condition in the last three years. This includes circumstances where a threshold condition is met by a relevant body but a different relevant body was carrying on the business of a promoter - provided both were controlled by the person in question at the earlier time. This also includes circumstances where the relevant bodies have ceased to exist.
17.New paragraph 13D sets out the circumstances in which a relevant body can be treated as meeting a threshold condition by virtue of another relevant body meeting a threshold condition in the last 3 years – provided the latter was controlled at the earlier time by the same person who now controls the former. This includes circumstances where a threshold condition is met by a relevant body but a different relevant body was carrying on the business of a promoter, provided both were controlled by the person in question at the earlier time. This also includes circumstances where the relevant bodies have ceased to exist.
18.Paragraph 5 makes consequential amendments to Schedule 36.
19.Paragraph 6 amends paragraph 5 Schedule 34 Finance Act 2014 by substituting new subparagraphs 5(2) to 5(6) for existing subparagraph 5(2).
20.New subparagraph 5(2) provides that a person will have failed to comply with the provisions of Part 7 of Finance Act 2004 (disclosure of tax avoidance schemes) listed in paragraph 5(1) of Schedule 34 if any of new conditions A to C, introduced by this Schedule, are met.
21.New subparagraph 5(3) sets out condition A, which is met where a tribunal determines that there has been a failure to comply with the provision concerned, provided that determination is final.
22.New subparagraph 5(4) sets out condition B, which is met where there has been a failure to comply with the provision concerned but the tribunal deems there to have been no failure on account of a reasonable excuse.
23.New subparagraph 5(5) sets out condition C, which is met where a person who has failed to comply with the provision concerned admits that failure in writing to HMRC.
24.New subparagraph 5(6) defines “appeal period” for the purposes of the preceding provisions.
25.Paragraph 7 amends paragraph 8 Schedule 34 Finance Act 2014 so that the threshold condition of professional misconduct by a promoter takes into account decisions by independent bodies.
26.Paragraph 8 provides for the power to amend or add to the circumstances in which a person is treated as meeting a threshold condition by statutory instrument. Any such instrument would be subject to the affirmative procedure.
27.Paragraph 9 sets out the date of commencement for the changes introduced by this Schedule. These changes will have effect for the purposes of determining whether a person meets a threshold condition in a period of three years ending on or after the date of Royal Assent to Finance Act 2015.
