The National Insurance Contributions (Application of Part 7 of the Finance Act 2004) Regulations 2012

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations revoke and replace the National Insurance Contributions (application of Part 7 of the Finance Act 2004) Regulations 2007 (S.I. 2007/785) (“the 2007 Regulations”) and consolidate all subsequent amendments to those Regulations with minor further amendments.

These Regulations make provision corresponding to the Part 7 of the Finance Act 2004 (“the 2004 Act”) and apply regulations under that Part (with necessary modifications) to the extent that they relate to income tax to arrangements or proposals for arrangements which are intended to avoid national insurance contributions.

Part 1 deals with introductory matters, interpretation and provides that anything begun under the 2007 Regulations shall be continued under the corresponding provision of these Regulations.

Part 2 contains provisions corresponding to Part 7 of the 2004 Act (disclosure of tax avoidance schemes). The exception is section 314 (legal professional privilege) which is instead included in the enabling powers at section 132A(6).

Part 3 makes provisions corresponding to section 98C of the Taxes Management Act 1970 (penalties for failure to comply with Part 7 of the 2004 Act) and applies Part 10 of the Taxes Management Act 1970 with modifications in so far as it applies to a penalty under that section.

Part 4 applies regulations made under Part 7 of the 2004 Act to national insurance contribution avoidance schemes and proposals and modifies them as necessary. They are the Tax Avoidance Schemes (Prescribed Descriptions of Arrangements) Regulations 2006 (S.I. 2006/1543), the Tax Avoidance Schemes (Information) Regulations 2012 (S.I. 2012/xxxx), the Tax Avoidance Schemes (Promoters and Prescribed Circumstances) Regulations 2004 (S.I. 2004/1865) and the Tax Avoidance Schemes (Penalty) Regulations 2007 (S.I. 2007/3104).

Part 5 revokes the National Insurance Contributions (Application of Part 7 of the Finance Act 2004) Regulations 2007 and its amending instruments.

A Tax Information and Impact Note has not been prepared for this instrument as it contains no substantive changes to tax policy.