Finance Act 2003

204Mandatory electronic payment by large employers

(1)The Commissioners of Inland Revenue (“the Commissioners”) may make regulations requiring large employers, subject to such exceptions as may be specified, to use electronic means for the making of specified payments under legislation relating to any tax under the care and management of the Commissioners.

(2)In subsection (1) “large employer” means a person paying PAYE income to 250 or more recipients.

Regulations under this section may make provision as to the date or period by reference to which this is to be determined and the circumstances in which a person is to be treated as paying PAYE income to a recipient.

(3)Regulations under this section may make provision—

(a)as to conditions that must be complied with in connection with the use of electronic means for the making of any payment;

(b)for treating a payment as not having been made unless conditions imposed by any of the regulations are satisfied;

(c)for determining the time when payment is to be taken to have been made.

(4)Regulations under this section may also make provision (which may include provision for the application of conclusive or other presumptions) as to the manner of proving for any purpose—

(a)whether any use of electronic means for making a payment is to be taken as having resulted in the payment being made;

(b)the time of the making of any payment for the making of which electronic means have been used;

(c)any other matter for which provision may be made by regulations under this section.

(5)Regulations under this section may—

(a)allow any authorisation or requirement for which the regulations may provide to be given or imposed by means of a specific or general direction given by the Commissioners;

(b)provide that the conditions of any such authorisation or requirement are to be taken to be satisfied only where the Inland Revenue are satisfied as to specified matters.

(6)Regulations under this section may contain provision—

(a)requiring the Inland Revenue to notify persons appearing to them to be, or to have become, a person required to use electronic means for the making of any payments in accordance with the regulations;

(b)enabling a person so notified to have the question whether he is such a person determined in the same way as an appeal.

(7)Regulations under this section may confer power on the Commissioners to give specific or general directions—

(a)suspending, for any period during which the use of electronic means for the making of payments is impossible or impractical, any requirements imposed by the regulations relating to the use of such means;

(b)substituting alternative requirements for the suspended ones;

(c)making any provision that is necessary in consequence of the imposition of the substituted requirements.

(8)The power to make provision by regulations under this section includes power—

(a)to provide for a contravention of, or any failure to comply with, the regulations (a “default”) to attract a surcharge of a specified amount;

(b)to provide that specified enactments relating to penalties imposed for the purposes of any taxation matter within the care and management of the Commissioners (including enactments relating to assessments, review and appeal) apply, with or without modifications, in relation to surcharges under the regulations.

(9)The regulations may specify the surcharge for each default as—

(a)a specified percentage, depending on the circumstances but not exceeding 10%, of the amount of the payment to which the default relates, or

(b)a specified percentage, depending on the circumstances but not exceeding 0.83%, of the total amount of tax due for the accounting period, year of assessment or other specified period of twelve months during which the default occurred;

but, in either case, they may specify £30 if it is more.

(10)Regulations under this section may—

(a)make different provision for different cases;

(b)make such incidental, supplemental, consequential and transitional provision in connection with any provision contained in any of the regulations as the Commissioners think fit.

(11)Regulations under this section shall be made by statutory instrument subject to annulment in pursuance of a resolution of the House of Commons.

(12)In this section—

• “the Inland Revenue” means—

  (a)

  the Commissioners,

  (b)

  any officer of the Commissioners, or

  (c)

  any other person who for the purposes of electronic means of payment is acting under the authority of the Commissioners;

• “legislation” means any enactment, Community legislation or subordinate legislation;

• “specified” means specified by or under regulations under this section;

• “subordinate legislation” has the same meaning as in the Interpretation Act 1978 (c. 30).