The Social Security (Contributions) Regulations 2001 No. 1004

SCHEDULE 4 U.K. [F1 Provisions derived from the Income Tax Acts and the Income Tax (Pay As You Earn) Regulations 2003]

Textual Amendments

F1 Sch. 4 heading substituted (6.4.2004) by The Social Security (Contributions, Categorisation of Earners and Intermediaries) (Amendment) Regulations 2004 (S.I. 2004/770), regs. 1(1), 29(2)

[F2 Part 3C U.K. CERTAIN DEBTS OF COMPANIES UNDER PARAGRAPH 3ZB OF PART 8 OF SCHEDULE 3 (TRAVEL EXPENSES OF WORKERS PROVIDING SERVICES THROUGH EMPLOYMENT INTERMEDIARIES)

Textual Amendments

F2 Sch. 4 Pt. 3C inserted (E.W.S.) (28.11.2016) by The Social Security (Contributions) (Amendment No. 4) Regulations 2016 (S.I. 2016/1067), regs. 1, 7

Interpretation of Part 3C: “relevant contributions debt” and “relevant date” U.K.

29Y.— (1) In this Part “relevant contributions debt”, in relation to a company means an amount within any of sub-paragraphs (2) to (5).

(2) An amount within this sub-paragraph is an amount that the company is to account for in accordance with paragraph 3ZB(6A) to (6C) (persons providing fraudulent documents).

(3) An amount within this sub-paragraph is an amount which a company is to deduct and pay by virtue of paragraph 3ZB in circumstances where—

(a) a company is an employment intermediary,

(b) on the basis that paragraph 3ZB does not apply by virtue of sub-paragraph (3) of that paragraph the company has not deducted and paid the amount, but

(c) the company has not been provided by any other person with evidence from which it would be reasonable in all the circumstances to conclude that sub-paragraph (3) of that paragraph applied (and the mere assertion by a person that the manner in which the worker provided the services was not subject to (or to the right of) supervision, direction or control by any person is not such evidence).

(4) An amount within this sub-paragraph is an amount that the company is to deduct and pay in accordance with paragraph 3ZB in circumstances where sub-paragraph (4) of that paragraph applies (services provided under arrangements made by intermediaries).

(5) An amount within this sub-paragraph is any interest or penalty in respect of an amount within any of sub-paragraphs (2) to (4) for which the company is liable.

(6) In this paragraph “paragraph 3ZB” means paragraph 3ZB of Part 8 of Schedule 3 to these Regulations.

(7) In this Part “the relevant date” in relation to a relevant contributions debt means the date on which the first payment is due on which contributions are not accounted for.

Interpretation of Part 3C: general U.K.

29Z.   In this Part—

“company” includes a limited liability partnership;

“director” has the meaning given by section 67 of ITEPA 2003;

“personal liability notice” has the meaning given by paragraph 29Z1(2);

“the specified amount” has the meaning given by paragraph 29Z1(2)(a).

Liability of directors for relevant contributions debts U.K.

29Z1.— (1) This paragraph applies in relation to an amount of relevant contributions debt of a company if the company does not deduct that amount by the time by which the company is required to do so.

(2) HMRC may serve a notice (“personal liability notice”) on any person who was, on the relevant date, a director of the company—

(a) specifying the amount of relevant contributions debt in relation to which this paragraph applies (“the specified amount”), and

(b) requiring the director to pay HMRC—

(i) the specified amount, and

(ii) specified interest on that amount.

(3) The interest specified in the personal liability notice—

(a) is to be at the rate applicable under section 178 of the Finance Act 1989 for the purposes of section 86 of the Taxes Management Act 1970, and

(b) is to run from the date the notice is served.

(4) A director who is served with a personal liability notice is liable to pay to HMRC the specified amount and the interest specified in the notice within 30 days beginning with the day the notice is served.

(5) If HMRC serve personal liability notices on more than one director of the company in respect of the same amount of relevant contributions debt, the directors are jointly and severally liable to pay to HMRC the specified amount and the interest specified in the notices.

Appeals in relation to personal liability notices U.K.

29Z2.— (1) A person who is served with a personal liability notice in relation to an amount of relevant contributions debt of a company may appeal against the notice.

(2) A notice of appeal must—

(a) be given to HMRC within 30 days beginning with the day the personal liability notice is served, and

(b) specify the grounds of the appeal.

(3) The grounds of appeal are—

(a) that all or part of the specified amount does not represent an amount of relevant contributions debt, of the company, to which paragraph 29Z1 applies, or

(b) that the person was not a director of the company on the relevant date.

(4) But a person may not appeal on the ground mentioned in sub-paragraph (3)(a) if it has already been determined, on an appeal by the company, that—

(a) the specified amount is a relevant contributions debt of the company, and

(b) the company did not deduct, account for, or (as the case may be) pay the debt by the time by which the company was required to do so.

(5) Subject to sub-paragraph (6), on an appeal that is notified to the tribunal, the tribunal is to uphold or quash the personal liability notice.

(6) In a case in which the ground of appeal mentioned in sub-paragraph (3)(a) is raised, the tribunal may also reduce or increase the specified amount so that it does represent an amount of relevant contributions debt, of the company, to which paragraph 29Z1 applies.

Withdrawal of personal liability notices U.K.

29Z3.— (1) A personal liability notice is withdrawn if the tribunal quashes it.

(2) An officer of Revenue and Customs may withdraw a personal liability notice if the officer considers it appropriate to do so.

(3) If a personal liability notice is withdrawn, HMRC must give notice of that fact to the person upon whom the notice was served.

Recovery of sums due under personal liability notice: application of Part 6 of Taxes Management Act 1970 U.K.

29Z4.— (1) For the purposes of this Part, Part 6 of the Taxes Management Act 1970 (collection and recovery) applies as if—

(a) the personal liability notice were an assessment, and

(b) the specified amount and any interest on that amount under paragraph 29Z1(2)(b)(ii) were income tax charged on the director upon whom the notice is served, and that Part of that Act applies with the modification in paragraph (2) and any other necessary modifications.

(2) Summary proceedings for the recovery of the specified amount, and any interest on that amount under paragraph 29Z1(2)(b)(ii), may be brought in England and Wales or Northern Ireland at any time before the end of the period of 12 months beginning with the day after the day on which personal liability notice is served.

Repayment of surplus amounts U.K.

29Z5.— (1) This paragraph applies if—

(a) one or more personal liability notices are served in respect of an amount of relevant contributions debt of a company, and

(b) the amounts paid to HMRC (whether by directors upon whom notices are served or the company) exceed the aggregate of the specified amount and any interest on it under paragraph 29Z1(2)(b)(ii).

(2) HMRC is to repay the difference on a just and equitable basis and without unreasonable delay.

(3) HMRC is to pay interest on any sum repaid.

(4) The interest—

(a) is to be at the rate applicable under section 178 of the Finance Act 1989 for the purposes of section 824 of the Taxes Act, and

(b) is to run from the date the amounts paid to HMRC come to exceed the aggregate mentioned in sub-paragraph (1)(b).]