SCHEDULES

SCHEDULE 18U.K.Requirement to correct certain offshore tax non-compliance

PART 1 U.K.Liability for penalty for failure to correct

“Involves an offshore matter” and “involves an offshore transfer”U.K.

9(1)This paragraph applies to any tax non-compliance consisting of a failure to comply with an obligation under section 7 of TMA 1970 to notify chargeability to income tax or capital gains tax.U.K.

(2)The tax non-compliance “involves an offshore matter” if the potential loss of revenue is charged on or by reference to—

(a)income arising from a source in a territory outside the UK,

(b)assets situated or held in a territory outside the UK,

(c)activities carried on wholly or mainly in a territory outside the UK, or

(d)anything having effect as if it were income, assets or activities of a kind described above.

(3)The tax non-compliance “involves an offshore transfer” if—

(a)it does not involve an offshore matter, and

(b)the applicable condition is satisfied (see sub-paragraphs (4) and (5)).

(4)Where the tax at stake is income tax the applicable condition is satisfied if the income on or by reference to which tax is charged, or any part of the income—

(a)was received in a territory outside the UK, or

(b)was transferred on or before 5 April 2017 to a territory outside the UK.

(5)Where the tax at stake is capital gains tax, the applicable condition is satisfied if the proceeds of the disposal on or by reference to which the tax is charged, or any part of the proceeds—

(a)were received in a territory outside the UK, or

(b)were transferred on or before 5 April 2017 to a territory outside the UK.

(6)In the case of a transfer falling within sub-paragraph (4)(b) or (5)(b), references to the income or proceeds transferred are to be read as including references to any assets derived from or representing the income or proceeds.

(7)In this paragraph and paragraphs 10 and 11 “assets” has the meaning given in section 21(1) of TCGA 1992, but also includes sterling.