The Finance Act 2008 (Penalties for Errors and Failure to Notify etc) (Consequential Amendments) Order 2010

Made2nd March 2010

Laid before the House of Commons3rd March 2010

Coming into force1st April 2010

The Treasury make the following Order in exercise of the powers conferred by sections 122 and 123 of the Finance Act 20081.

Citation and commencement1

This Order may be cited as the Finance Act 2008 (Penalties for Errors and Failure to Notify etc) (Consequential Amendments) Order 2010 and comes into force on 1st April 2010.

Consequential amendments2

The Schedule to this Order contains amendments in consequence of Schedule 24 to the Finance Act 20072 and Schedule 41 to the Finance Act 2008.

Dave WattsTony CunninghamTwo of the Lords Commissioners of Her Majesty’s Treasury

SCHEDULE

Article 2

Taxes Management Act

1

The Taxes Management Act 19703 is amended as follows.

2

In section 59C(4)4 (surcharges on unpaid income tax and capital gains tax) for “section 7 or 93(5) of this Act or Schedule 24 to the Finance Act 2007” substitute “section 93(5) of this Act, Schedule 24 to the Finance Act 2007 or Schedule 41 to the Finance Act 2008”.

3

In section 107A(2)(a)5 (relevant trustees)—

a

omit “7,”, and

b

after “Schedule 24 to the Finance Act 2007” insert “or Schedule 41 to the Finance Act 2008”.

Finance Act 19944

In Schedule 7 to the Finance Act 19946 (insurance premium tax), in paragraph 20 omit “14(3),”.

Value Added Tax Act 19945

In section 74(4) of the Value Added Tax Act 19947 (interest on VAT recovered or recoverable by assessment), for “section 67(2)” substitute “paragraph 2(3) of Schedule 41 to the Finance Act 2008”.

Finance Act 19966

In Schedule 5 to the Finance Act 19968 (landfill tax)—

a

in paragraph 27(9)(a) after “Part V of this Schedule” insert “or under Schedule 41 to the Finance Act 2008”;

b

in paragraphs 22(4)(b) and 23(2)(b), after “Schedule 24 to the Finance Act 2007 (penalties for errors)” insert “or a penalty under Schedule 41 to the Finance Act 2008 (penalties: failure to notify and certain VAT and excise wrongdoing)”.

Income Tax (Trading and Other Income) Act 2005

7

The Income Tax (Trading and Other Income) Act 20059 is amended as follows.

8

In section 54(2) (no deduction allowed for penalties, interest and VAT surcharges), at the end of the table add—

“Penalty under Schedule 41 to FA 2008

Various taxes and excise duties”

9

In section 869(4) (no deduction allowed for penalties, interest and VAT surcharges), at the end of the table add—

“Penalty under Schedule 41 to FA 2008

Various taxes and excise duties”

Corporation Tax Act 200910

In section 1303(2) Corporation Tax Act 200910 (no deduction allowed for penalties, interest and VAT surcharges), at the end of the table add—

“Penalty under Schedule 24 to FA 2007	Various taxes and excise duties
Penalty under Schedule 41 to FA 2008	Various taxes and excise duties”

EXPLANATORY NOTE

(This note is not part of the Order)

This Order contains amendments in consequence of Schedule 24 to the Finance Act 2007 and Schedule 41 to the Finance Act 2008. Schedule 24 introduced a single penalty regime for errors in documents given to Her Majesty’s Revenue and Customs (“HMRC”). Schedule 41 introduced a single penalty regime for failure to comply with a relevant obligation to notify HMRC of chargeability to tax, liability to register for tax etc., as well as penalties for issuing an unauthorised VAT invoice, putting a product to a use that attracts a higher rate of excise duty, and handling goods subject to unpaid excise duty.

Article 2 and the Schedule to the Order provide for consequential amendments to primary legislation.

An Impact Assessment on the wider penalties reform was published by HMRC on 27 March 2008 and is available from HMRC’s website at http://www.hmrc.gov.uk/ria/penalties.pdf .