Finance (No. 2) Act 2017

PART 9 U.K.Information

Information and inspection powers: application of Schedule 36 to FA 2008U.K.

40[F1(1)Schedule 36 to FA 2008 (information and inspection powers) applies for the purpose of—U.K.

(a)checking a relevant person's position as regards liability for a penalty under paragraph 1 in relation to particular tax arrangements;

(b)ascertaining the identity of any other person who has or may have enabled those arrangements,

as it applies for the purpose of checking a person's tax position, subject to the modifications in paragraphs 41 to 43.]

(2)In this paragraph and paragraphs 41 to 43—

• “relevant person” means a person an officer of Revenue and Customs has reason to suspect is or may be liable to a penalty under paragraph 1 [F2(or will become or may become so liable if T incurs a defeat)];

• “the Schedule” means Schedule 36 to FA 2008.

[F3(3)References in this paragraph and paragraphs 41 and 42 to a person who has or may have enabled particular tax arrangements are to be read in accordance with Part 4 of this Schedule (persons who “enabled” the arrangements), save that—

(a)references in that Part to the arrangements mentioned in paragraph 1 (however expressed) are to be read as references to the particular tax arrangements, and

(b)references in that Part to “T” are to be read as references to the person who entered into the particular tax arrangements.]

General modifications of Schedule 36 to FA 2008 as appliedU.K.

41U.K.In its application for [F4a purpose] mentioned in paragraph 40(1) above, the Schedule has effect as if—

(a)any provisions which can have no application for that purpose were omitted,

(b)references to “the taxpayer” were references to the relevant person whose position as regards liability for a penalty under paragraph 1 is to be checked, and references to “a taxpayer” were references to a relevant person,

(c)references to a person's “tax position” were to the relevant person's position as regards liability for a penalty under paragraph 1,

(d)references to prejudice to the assessment or collection of tax included prejudice to [F5—

(i)the investigation of the relevant person's position as regards liability for a penalty under paragraph 1 in relation to particular tax arrangements, or (as the case may be)

(ii)the identification of any other person who has or may have enabled those arrangements, and]

(e)references to a pending appeal relating to tax were to a pending appeal relating to an assessment of liability for a penalty under paragraph 1.

Specific modifications of Schedule 36 to FA 2008 as appliedU.K.

Declarations about contents of legally privileged communicationsU.K.

44(1)Subject to sub-paragraph (5), a declaration under this paragraph is to be treated by—U.K.

(a)HMRC, or

(b)in any proceedings before a court or tribunal in connection with a penalty under paragraph 1, the court or tribunal,

as conclusive evidence of the things stated in the declaration.

(2)A declaration under this paragraph is a declaration which—

(a)is made by a relevant lawyer,

(b)relates to one or more communications falling within sub-paragraph (3), and

(c)meets such requirements as may be prescribed by regulations under sub-paragraph (4).

(3)A communication falls within this sub-paragraph if—

(a)it was made by a relevant lawyer (whether or not the one making the declaration),

(b)it is legally privileged, and

(c)if it were not legally privileged, it would be relied on by a person for the purpose of establishing that that person is not liable to a penalty under paragraph 1 (whether or not that person is the person who made the communication or is making the declaration).

(4)The Treasury may by regulations impose requirements as to the form and contents of declarations under this paragraph.

(5)Sub-paragraph (1) does not apply where HMRC or (as the case may be) the court or tribunal is satisfied that the declaration contains information which is incorrect.

(6)In this paragraph “a relevant lawyer” means a barrister, advocate, solicitor or other legal representative communications with whom may be the subject of a claim to legal professional privilege or, in Scotland, protected from disclosure in legal proceedings on the grounds of confidentiality of communication.

(7)For the purpose of this paragraph, a communication is “legally privileged” if it is a communication in respect of which a claim to legal professional privilege, or (in Scotland) to confidentiality of communications as between client and professional legal adviser, could be maintained in legal proceedings.

45(1)Where a person carelessly or deliberately gives any incorrect information in a declaration under paragraph 44, the person is liable to a penalty not exceeding £5,000.U.K.

(2)For the purposes of this paragraph, incorrect information is carelessly given by a person if the information is incorrect because of a failure by the person to take reasonable care.

(3)Paragraphs 19(1), 20, 22(1), 37, 38 and 39(1), (2) and (5) apply in relation to a penalty under this paragraph as they apply in relation to a penalty under paragraph 1, subject to the modifications in sub-paragraphs (4) and (5).

(4)In its application to a penalty under this paragraph, paragraph 22(1) has effect as if for “the relevant time” there were substituted “the end of 12 months beginning with the date on which facts sufficient to indicate that the person is liable to the penalty came to the Commissioners' knowledge”.

(5)In its application to a penalty under this paragraph, paragraph 38(3) has effect as if the reference to the arrangements to which the penalty relates were to the arrangements to which the declaration under paragraph 44 relates.

(6)In paragraph 44 any reference to a penalty under paragraph 1 includes a reference to a penalty under this paragraph.