Finance Act 2007

Part 4U.K.Miscellaneous

AgencyU.K.

18(1)P is liable under paragraph 1(1)(a) where a document which contains a careless inaccuracy (within the meaning of paragraph 3) is given to HMRC on P's behalf.U.K.

(2)In paragraph 2(1)(b) and (2)(a) a reference to P includes a reference to a person who acts on P's behalf in relation to tax.

(3)Despite sub-paragraphs (1) and (2), P is not liable to a penalty [F1under paragraph 1 or 2] in respect of anything done or omitted by P's agent where P satisfies HMRC that P took reasonable care to avoid inaccuracy (in relation to paragraph 1) or unreasonable failure (in relation to paragraph 2).

(4)In paragraph 3(1)(a) (whether in its application to a document given by P or, by virtue of sub-paragraph (1) above, in its application to a document given on P's behalf) a reference to P includes a reference to a person who acts on P's behalf in relation to tax.

(5)In paragraph 3(2) a reference to P includes a reference to a person who acts on P's behalf in relation to tax.

[F2(6)[F3Paragraphs 3A and 3C apply] where a document is given to HMRC on behalf of P as [F4they apply] where a document is given to HMRC by P (and in paragraph 3B(9) the reference to P includes a person acting on behalf of P).]

Companies: officers' liabilityU.K.

19(1)Where a penalty under paragraph 1 is payable by a company for a deliberate inaccuracy which was attributable to an officer [F5of the company, the officer is liable to pay such portion of the penalty (which may be 100%) as HMRC] may specify by written notice to the officer. U.K.

(2)Sub-paragraph (1) does not allow HMRC to recover more than 100% of a penalty.

(3)In the application of sub-paragraph (1) to a body corporate [F6other than a limited liability partnership] “officer” means—

(a)a director (including a shadow director within the meaning of section 251 of the Companies Act 2006 (c. 46)), F7...

[F8(aa)a manager, and]

(b)a secretary.

[F9(3A)In the application of sub-paragraph (1) to a limited liability partnership, “officer” means a member.]

(4)In the application of sub-paragraph (1) in any other case “officer” means—

(a)a director,

(b)a manager,

(c)a secretary, and

(d)any other person managing or purporting to manage any of the company's affairs.

[F10(5)Where HMRC have specified a portion of a penalty in a notice given to an officer under sub-paragraph (1)—

(a)paragraph 11 applies to the specified portion as to a penalty,

(b)the officer must pay the specified portion before the end of the period of 30 days beginning with the day on which the notice is given,

(c)paragraph 13(2), (3) and (5) apply as if the notice were an assessment of a penalty,

(d)a further notice may be given in respect of a portion of any additional amount assessed in a supplementary assessment in respect of the penalty under paragraph 13(6),

(e)paragraphs 15(1) and (2), 16 and 17(1) to (3) and (6) apply as if HMRC had decided that a penalty of the amount of the specified portion is payable by the officer, and

(f)paragraph 21 applies as if the officer were liable to a penalty.]

[F11(6)In this paragraph “company” means any body corporate or unincorporated association, but does not include a partnership, a local authority or a local authority association.]

PartnershipsU.K.

20(1)This paragraph applies where P is liable to a penalty under paragraph 1 for an inaccuracy in or in connection with a partnership return.U.K.

(2)Where the inaccuracy affects the amount of tax due or payable by a partner of P, the partner is also liable to a penalty (“a partner's penalty”).

(3)Paragraphs 4 to 13 and 19 shall apply in relation to a partner's penalty (for which purpose a reference to P shall be taken as a reference to the partner).

(4)Potential lost revenue shall be calculated separately for the purpose of P's penalty and any partner's penalty, by reference to the proportions of any tax liability that would be borne by each partner.

(5)Paragraph 14 shall apply jointly to P's penalty and any partner's penalties.

(6)P may bring an appeal under paragraph 15 in respect of a partner's penalty (in addition to any appeal that P may bring in connection with the penalty for which P is liable).

Double jeopardyU.K.

21U.K.[F12A person is] not liable to a penalty under paragraph 1 [F13, 1A] or 2 in respect of an inaccuracy or failure in respect of which [F14the person has] been convicted of an offence.

[F1521ZA(1)A person is not liable to a penalty under paragraph 1 in respect of an inaccuracy if—U.K.

(a)the inaccuracy involves a claim by the person to exercise or rely on a VAT right (in relation to a supply) that has been denied or refused by HMRC as mentioned in subsection (4) of section 69C of VATA 1994, and

(b)the person has been assessed to a penalty under that section (and the assessment has not been successfully appealed against or withdrawn).

(2)In sub-paragraph (1)(a) “VAT right” has the same meaning as in section 69C of VATA 1994.]