Legislation – Finance Act 2026

HMRC have notified a lawyer that they intend to publish, or are considering publishing, information identifying the lawyer under a provision listed in subsection (5), and

(b)

the lawyer—

(i)

intends to make representations to the effect that the information should not be published, but

(ii)

will not be able to substantiate some or all of those representations without disclosing the content of privileged communications.

(2)

A lawyer (whether or not the lawyer intending to make the representations) may make a declaration to the effect that—

(a)

the representations are true, and

(b)

the content of privileged communications would be sufficient (whether alone or with other information) to demonstrate this on the balance of probabilities.

(3)

When considering whether the information referred to in subsection (1)(a) may be published, HMRC and, in the context of proceedings, a court or tribunal must treat a declaration made under subsection (2) and provided under a provision listed in subsection (5) as conclusive evidence of the information included in the declaration.

(4)

But subsection (3) does not apply if HMRC, or the court or tribunal, is satisfied that the declaration includes any information that is incorrect.

(5)

The provisions are—

(a)

section 316C of FA 2004 (disclosure of tax avoidance schemes);

(b)

paragraph 36 of Schedule 17 to F(No.2)A 2017 (disclosure of tax avoidance schemes: VAT and other indirect taxes);

(c)

section 86 of FA 2022 (publication of information about tax avoidance schemes).

(6)

For the purposes of this section—

(a)

references to a lawyer are references to a person in respect of whose communications a claim to legal professional privilege, or (in Scotland) to confidentiality of proceedings as between client and professional legal adviser, could be maintained in legal proceedings, and

(b)

a communication is “privileged” if such a claim could be maintained in respect of it.

(7)

In this section—

“HMRC” means—

(a)

where the provision referred to in subsection (1)(a) is section 316C of FA 2004, HMRC as defined for the purposes of that section;

(b)

where the provision referred to in subsection (1)(a) is paragraph 36 of Schedule 17 to F(No.2)A 2017, HMRC as defined for the purposes of that paragraph;

(c)

where the provision referred to in subsection (1)(a) is section 86 of FA 2022—

(i)
in subsection (1)(a), an officer of Revenue and Customs;
(ii)
in subsections (3) and (4), an authorised officer as defined for the purposes of that section;

“tribunal” means the First-tier Tribunal or, where determined by or under Tribunal Procedure Rules, the Upper Tribunal.

(8)

The Commissioners for His Majesty’s Revenue and Customs may by regulations make provision about—

(a)

the form of a declaration made under subsection (2),

(b)

the information to be included in a declaration,

(c)

when and how a declaration is to be provided.

(9)

Regulations under this section—

(a)

are to be made by statutory instrument, and

(b)

may make different provision for different purposes.

(10)

A statutory instrument containing regulations made under this section is subject to annulment in pursuance of a resolution of the House of Commons.

210Penalties for an incorrect declaration

(1)

A person who makes a declaration under section 209(2) and carelessly or deliberately includes any incorrect information in the declaration is liable to a penalty not exceeding £10,000.

(2)

Where—

(a)

a person (“A”) provides a declaration under a provision listed in section 209(5) which is made under section 209(2) by another person,

(b)

the declaration includes incorrect information, and

(c)

A knew, or could reasonably have been expected to have known, that the information was incorrect,

A is liable to a penalty not exceeding £10,000.

(3)

For the purposes of subsection (1), incorrect information is included in a declaration carelessly if the person who makes the declaration has failed to take reasonable care to verify the information before including it.

211Penalties: procedure, appeals etc

(1)

Subject to subsection (2), a penalty under section 210 is to be treated as a penalty imposed under the Taxes Acts and, accordingly, is a penalty to be determined and imposed by an authorised officer under section 100(1) of TMA 1970.

(2)

A penalty under section 210 is not required to be paid before the penalty becomes final.

(3)

For the purposes of subsection (2) and sections 212 and 213 a penalty becomes “final” at the time when the period for any appeal or further appeal relating to the penalty expires or, if later, when any appeal or final appeal relating to the penalty is finally determined.

212Publication following an incorrect declaration

(1)

An authorised officer may publish information about a person where—

(a)

the person has incurred a penalty under section 210 in relation to a declaration, and

(b)

the penalty has become final.

(2)

The information that may be published under this section is—

(a)

the person’s name (including any trading name, previous name or pseudonym);

(b)

any address used by the person;

(c)

any other information that the authorised officer considers appropriate for the purposes of identifying the person or their business;

(d)

details of the arrangements to which the declaration relates including the nature of the person’s involvement in those arrangements;

(e)

details of the penalty imposed on the person under section 210.

(3)

The information may be published in any way that the authorised officer considers appropriate.

(4)

Before publishing information under this section, the authorised officer must—

(a)

notify the person that they are considering doing so,

(b)

give the person 30 days from that notification in which to make representations about whether it should be published, and

(c)

have regard to any representations received.

(5)

In this section—

“arrangements” means—

(a)

in relation to a declaration provided under section 316C(6)(b)(ii) of FA 2004, arrangements or proposed arrangements, with those terms having the same meaning as in that section;

(b)

in relation to a declaration provided under paragraph 36(6)(b)(ii) of Schedule 17 to F(No.2)A 2017, arrangements or proposed arrangements, with those terms having the same meaning as in that paragraph;

(c)

in relation to a declaration provided under section 86(5)(b)(ii) of FA 2022, a proposal or arrangements, with those terms having the same meaning as in that section;

“authorised officer” means an officer of Revenue and Customs authorised for the purposes of this section.

213Time limits for publication

(1)

Publication of any information under section 212 on the basis of a penalty incurred by a person may not take place after the end of the period of 12 months beginning with the date on which the penalty became final.

(2)

Subsection (1) is not to be taken to prevent the re-publication, or continued publication, after the end of the period referred to in that subsection, of information published under section 212 before the end of the period.

214Amendments to existing legislation: removal of privilege exemption

(1)

In section 316C of FA 2004 (disclosure of tax avoidance schemes)—

(a)

omit subsection (4A);

(b)

in subsection (6)(b)—

(i)

the words from “make representations” to the end become sub-paragraph (i);

(ii)

after that sub-paragraph insert “, and

(ii)

where section 209(2) of FA 2026 applies, provide a declaration made under that subsection substantiating those representations.”.

(2)

In paragraph 36 of Schedule 17 to F(No.2)A 2017 (disclosure of tax avoidance schemes: VAT and other indirect taxes)—

(a)

omit sub-paragraph (4A);

(b)

in sub-paragraph (6)(b)—

(i)

the words from “make representations” to the end become sub-paragraph (i);

(ii)

after that sub-paragraph insert “, and

(ii)

where section 209(2) of FA 2026 applies, provide a declaration made under that subsection substantiating those representations.”.

(3)

In section 86 of FA 2022 (publication of information about tax avoidance schemes)—

(a)

omit subsection (3)(b) (and the “or” before it);

(b)

in subsection (5)(b)—

(i)

the words from “make representations” to the end become sub-paragraph (i);

(ii)

after that sub-paragraph insert “, and

(ii)

where section 209(2) of FA 2026 applies, provide a declaration made under that subsection substantiating those representations.”;

(c)

in subsection (6), after “representations” insert “and any declaration”.

215Commencement

(1)

Subject to subsection (2), sections 209 to 214 have effect from the day on which this Act is passed.

(2)

The amendments made by section 214 have effect only in relation to conduct occurring on or after the day on which this Act is passed.

Disclosure of tax avoidance schemes: consequences for failure to comply

216Penalties for non-disclosure of tax avoidance schemes

(1)

In TMA 1970—

(a)

omit section 98C (notifications under Part 7 of FA 2004);

(b)

in section 100(2) (determination of penalties by an officer of the Board), omit paragraph (f);

(c)

in section 103A (interest on penalties), omit “(other than section 98C)”.

(2)

In Part 7 of FA 2004 (disclosure of tax avoidance schemes)—

(a)

in section 313(4), for “98C of the Taxes Management Act 1970” substitute “315”;

(b)

for section 315 substitute—

“315Penalties

(1)

A person who fails to comply with a duty imposed by a provision mentioned in the first column of the table is liable to a penalty not exceeding the amount specified in relation to that provision in the second column.

Provision

Maximum penalty amount

Section 308(1) or (3) (promoter’s duty to notify)

The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million

Section 309(1) (client’s duty to notify: no UK promoter)

The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million

Section 310 (client’s duty to notify: no promoter)

The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million

Section 310A (duty to provide further information)

The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million

Section 310C (promoter’s duty to update information)

£5,000

Section 311C (duty to provide further information: section 311(3) case)

The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million

Section 312(2) (promoter’s duty to notify client of SRN)

£5,000

Section 312ZA(2) (duty to notify client of SRN: section 311(3) case)

£5,000

Section 312A(2) or (2A) (client’s duty to notify other persons of SRN)

£5,000

Section 312B (client’s duty to provide client information to promoter or service provider)

£5,000

Section 313(1) or regulations under section 313(3) (other party’s duty to provide information)

The amount specified in subsection (4)

Section 313ZA (promoter’s or service provider’s duty to provide client information)

£5,000

Section 313ZB (service provider’s duty to provide other party’s information)

£5,000

Section 313ZC (employer’s duty to provide employee information)

£5,000

Section 313A (duty to provide statement on notifiability)

£5,000

Section 313B (duty to provide supporting evidence on notifiability)

£5,000

Section 313C (introducer’s duty to provide other person’s information)

£5,000

Section 316A (duty to provide information in addition to SRN to client or other persons)

£5,000

(2)

The “applicable rate” means—

(a)

£600, or

(b)

where an order has been made under section 306A or 314A (orders about notifiability) in respect of the arrangements or proposal in relation to which the person fails to comply—

(i)

£600 for each day falling before the end of the period of ten days beginning with the day on which the order was made, and

(ii)

£5,000 for each day falling after the end of that period.

(3)

This subsection applies where an authorised officer considers that the amount otherwise specified in relation to the provision is inappropriately low.

(4)

The amount specified for section 313(1) or regulations under section 313(3) is—

(a)

£10,000, if the person has failed to comply with the section or regulations on two or more other occasions during the period of 36 months ending with the date of the current failure,

(b)

£7,500, if the person has failed to comply with the section or regulations on one other occasion during the period of 36 months ending with the date of the current failure, or

(c)

£5,000, in any other case.

(5)

In subsection (1), a reference to a day on which a person fails to comply with a duty is a reference to a day that—

(a)

begins after the day by which the person was required to comply with the duty, and

(b)

ends before the earlier of—

(i)

the day on which the person complies with the duty,

(ii)

the day on which any reference number is allocated to the arrangements or proposed arrangements concerned in the circumstances described in subsection (6), and

(iii)

the day on which a penalty under subsection (1) is imposed in relation to the failure.

(6)

The circumstances are—

(a)

the duty referred to in subsection (5) is a duty imposed by section 308(1) or (3), 309(1) or 310, and

(b)

it is a case within section 311(3).

315AFurther penalties

(1)

If—

(a)

a penalty under section 315 is imposed in relation to a person’s failure to comply with a duty, and

(b)

after the penalty has been imposed, the person continues to fail to comply with the duty,

the person is liable to a further penalty not exceeding the applicable rate (as defined in section 315(2)) for each day on which the failure continues.

(2)

Subsection (1) does not apply to a failure to comply with a duty imposed by section 313(1) or regulations under section 313(3).

315BDetermination of penalties

(1)

A penalty under this Part is to be treated as a penalty under a provision of the Taxes Acts and, accordingly, is a penalty to be determined and imposed by an authorised officer under section 100(1) of TMA 1970.

(2)

In determining an amount of a specified penalty (including considering whether an amount is inappropriately low under section 315(3)), the authorised officer must have regard to all relevant considerations, including—

(a)

the desirability of the penalty being set at a level which appears appropriate for deterring the person, or other persons, from similar failures to comply on future occasions;

(b)

the amount of any fees received, or likely to have been received, by the person in connection with the proposal or arrangements concerned;

(c)

in the case of a person entering into the arrangements, the amount of any advantage gained, or sought to be gained, by that person.

(3)

In this section, a “specified penalty” is a penalty under section 315 that is imposed in relation to a person’s failure to comply with a duty imposed by section 308(1) or (3), 309(1), 310, 310A or 311C.

315CFailure to comply with time limit

A failure to do anything required to be done within a limited period of time does not give rise to liability to a penalty under section 315 or 315A if the person did it within such further time, if any, as an officer of Revenue and Customs or the tribunal may have allowed.

315DOther exemptions from liability to a penalty

(1)

A person is deemed not to have failed to comply with a duty imposed by a provision mentioned in the first column of the table in section 315(1) if the person had a reasonable excuse for the failure and—

(a)

the reasonable excuse continues to apply, or

(b)

the reasonable excuse has ceased to apply, but the person complied with the duty without unreasonable delay after the cessation.

(2)

Where an order is made under section 306A or 314A—

(a)

the order is not evidence that a person either does or does not have a reasonable excuse for non-compliance before the order was made, and

(b)

the person identified in the order as the promoter cannot rely on doubt as to notifiability as a reasonable excuse for a failure to comply with section 308.

(3)

Where a person fails to comply with—

(a)

section 309 and the promoter for the purposes of that section is a monitored promoter, or

(b)

section 310 and the arrangements for the purposes of that section are arrangements of a monitored promoter,

then any legal advice which was given or procured by that monitored promoter and which the person took into account is to be disregarded in determining whether the person has a reasonable excuse for the failure.

(4)

In determining whether or not a person who is a monitored promoter has a reasonable excuse for a failure to do anything required to be done, reliance on legal advice does not constitute a reasonable excuse if either—

(a)

the advice was not based on a full and accurate description of the facts, or

(b)

the conclusions in the advice that the person relied on were unreasonable.

(5)

For the purposes of this section, “monitored promoter” has the meaning given by section 244(5) of FA 2014.

315ERegulations to vary amounts

(1)

The Treasury may by regulations make provision for the purpose of varying any of the amounts specified in section 315 or 315A.

(2)

Regulations under this section—

(a)

must be made by statutory instrument, and

(b)

may not be made unless a draft has been laid before and approved by resolution of the House of Commons.”;

*Provision*	*Maximum penalty amount*
Section 308(1) or (3) (promoter’s duty to notify)	The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million
Section 309(1) (client’s duty to notify: no UK promoter)	The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million
Section 310 (client’s duty to notify: no promoter)	The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million
Section 310A (duty to provide further information)	The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million
Section 310C (promoter’s duty to update information)	£5,000
Section 311C (duty to provide further information: section 311(3) case)	The applicable rate for each day on which the person fails to comply or, if subsection (3) applies, £1 million
Section 312(2) (promoter’s duty to notify client of SRN)	£5,000
Section 312ZA(2) (duty to notify client of SRN: section 311(3) case)	£5,000
Section 312A(2) or (2A) (client’s duty to notify other persons of SRN)	£5,000
Section 312B (client’s duty to provide client information to promoter or service provider)	£5,000
Section 313(1) or regulations under section 313(3) (other party’s duty to provide information)	The amount specified in subsection (4)
Section 313ZA (promoter’s or service provider’s duty to provide client information)	£5,000
Section 313ZB (service provider’s duty to provide other party’s information)	£5,000
Section 313ZC (employer’s duty to provide employee information)	£5,000
Section 313A (duty to provide statement on notifiability)	£5,000
Section 313B (duty to provide supporting evidence on notifiability)	£5,000
Section 313C (introducer’s duty to provide other person’s information)	£5,000
Section 316A (duty to provide information in addition to SRN to client or other persons)	£5,000

(c)

in section 318, in the appropriate places insert—

““authorised officer” means an officer of Revenue and Customs authorised by His Majesty’s Revenue and Customs for the purposes of this Part or, as the case may be, section 100 of TMA 1970;

“Taxes Acts” has the same meaning as in TMA 1970 (see section 118(1) of that Act);”.

(3)

In Part 2 of Schedule 17 to F(No.2)A 2017 (disclosure of tax avoidance schemes: VAT and other indirect taxes)—

(a)

in the cross heading before paragraph 39 omit “(apart from paragraph 26)”;

(b)

for paragraphs 39 to 44 substitute—

“39

(1)

A person who fails to comply with a duty imposed by a provision of Part 1 of this Schedule mentioned in the first column of the table is liable to a penalty not exceeding the amount specified in relation to that provision in the second column.

Provision

Maximum penalty amount

Paragraph 11(1) or 12(1) (promoter’s duty to notify)

The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million

Paragraph 17(2) (client’s duty to notify: no UK promoter)

The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million

Paragraph 18(2) (client’s duty to notify: no promoter)

The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million

Paragraph 19 (duty to provide further information)

The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million

Paragraph 21 (promoter’s duty to update information)

£5,000

Paragraph 22C (duty to provide further information: paragraph 22(3) case)

The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million

Paragraph 23(2) (promoter’s duty to notify client of SRN)

£5,000

Paragraph 23A(2) (duty to notify client of SRN: paragraph 22(3) case)

£5,000

Paragraph 24(3) (client’s duty to notify other persons of SRN)

£5,000

Paragraph 25(2) (client’s duty to provide client information to promoter or service provider)

£5,000

Paragraph 26(1) or regulations under paragraph 26(3) (other party’s duty to provide information)

The amount specified in sub-paragraph (4)

Paragraph 27(3) (promoter’s or service provider’s duty to provide client information)

£5,000

Paragraph 28 (service provider’s duty to provide other party’s information)

£5,000

Paragraph 29 (duty to provide statement on notifiability)

£5,000

Paragraph 30 (duty to provide supporting evidence on notifiability)

£5,000

Paragraph 31 (introducer’s duty to provide other person’s information)

£5,000

Paragraph 33 (duty to provide information in addition to SRN to client or other persons)

£5,000

(2)

The “applicable rate” means—

(a)

£600, or

(b)

where an order has been made under paragraph 4 or 5 (orders about notifiability) in respect of the arrangements or proposal in relation to which the person fails to comply—

(i)

£600 for each day falling before the end of the period of eleven days beginning with the day on which the order was made, and

(ii)

£5,000 for each day falling after the end of that period.

(3)

This sub-paragraph applies where an authorised officer considers that the amount otherwise specified in relation to the provision is inappropriately low.

(4)

The amount specified for paragraph 26(1) or regulations under paragraph 26(3) is—

(a)

£10,000, if the person has failed to comply with the paragraph or regulations on two or more other occasions during the period of 36 months ending with the date of the current failure,

(b)

£7,500, if the person has failed to comply with the paragraph or regulations on one other occasion during the period of 36 months ending with the date of the current failure, or

(c)

£5,000, in any other case.

(5)

In sub-paragraph (1), a reference to a day on which a person fails to comply with a duty is a reference to a day that—

(a)

begins after the day by which the person was required to comply with the duty, and

(b)

ends before the earlier of—

(i)

the day on which the person complies with the duty,

(ii)

the day on which any reference number is allocated to the arrangements or proposed arrangements concerned in the circumstances described in sub-paragraph (6), and

(iii)

the day on which a penalty under sub-paragraph (1) is imposed in relation to the failure.

(6)

The circumstances are—

(a)

the duty referred to in sub-paragraph (5) is a duty imposed by paragraph 11(1), 12(1), 17(2) or 18(2), and

(b)

it is a case within paragraph 22(3).

(7)

In this paragraph “authorised officer” means an officer of Revenue and Customs authorised by HMRC for the purposes of this paragraph.

40

(1)

If—

(a)

a penalty under paragraph 39 is imposed in relation to a person’s failure to comply with a duty, and

(b)

after the penalty has been imposed, the person continues to fail to comply with the duty,

the person is liable to a further penalty not exceeding the applicable rate (as defined in paragraph 39(2)) for each day on which the failure continues.

(2)

Sub-paragraph (1) does not apply to a failure to comply with a duty imposed by paragraph 26(1) or regulations under paragraph 26(3).

41

(1)

In assessing the amount of a specified penalty (including considering whether an amount is inappropriately low under paragraph 39(3)), an authorised officer must have regard to all relevant considerations, including—

(a)

the desirability of the penalty being set at a level which appears appropriate for deterring the person, or other persons, from similar failures to comply on future occasions;

(b)

the amount of any fees received, or likely to have been received, by the person in connection with the proposal or arrangements concerned;

(c)

in the case of a person entering into the arrangements, the amount of any advantage gained, or sought to be gained, by that person.

(2)

In this paragraph—

(a)

“authorised officer” means an officer of Revenue and Customs authorised by HMRC for the purposes of this paragraph;

(b)

a “specified penalty” is a penalty under paragraph 39 that is imposed in relation to a person’s failure to comply with a duty imposed by paragraph 11(1), 12(1), 17(2), 18(2), 19 or 22C.

42

(1)

The Treasury may by regulations make provision for the purpose of varying any of the amounts specified in paragraph 39 or 40.

(2)

Regulations under this paragraph may include incidental or transitional provision.”;

Provision	Maximum penalty amount
Paragraph 11(1) or 12(1) (promoter’s duty to notify)	The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million
Paragraph 17(2) (client’s duty to notify: no UK promoter)	The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million
Paragraph 18(2) (client’s duty to notify: no promoter)	The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million
Paragraph 19 (duty to provide further information)	The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million
Paragraph 21 (promoter’s duty to update information)	£5,000
Paragraph 22C (duty to provide further information: paragraph 22(3) case)	The applicable rate for each day on which the person fails to comply or, if sub-paragraph (3) applies, £1 million
Paragraph 23(2) (promoter’s duty to notify client of SRN)	£5,000
Paragraph 23A(2) (duty to notify client of SRN: paragraph 22(3) case)	£5,000
Paragraph 24(3) (client’s duty to notify other persons of SRN)	£5,000
Paragraph 25(2) (client’s duty to provide client information to promoter or service provider)	£5,000
Paragraph 26(1) or regulations under paragraph 26(3) (other party’s duty to provide information)	The amount specified in sub-paragraph (4)
Paragraph 27(3) (promoter’s or service provider’s duty to provide client information)	£5,000
Paragraph 28 (service provider’s duty to provide other party’s information)	£5,000
Paragraph 29 (duty to provide statement on notifiability)	£5,000
Paragraph 30 (duty to provide supporting evidence on notifiability)	£5,000
Paragraph 31 (introducer’s duty to provide other person’s information)	£5,000
Paragraph 33 (duty to provide information in addition to SRN to client or other persons)	£5,000

(c)

omit paragraph 45 and the cross heading before paragraph 45;

(d)

in the italic cross heading before paragraph 46, omit “under paragraph 39(1)(b) or 44”;

(e)

in paragraph 46(1), for “39(1)(b) or 44” substitute “39 or 40”;

(f)

in paragraph 49(2)(a), for “prescribed period mentioned in paragraph 41” substitute “period mentioned in paragraph 39(2)(b)”.

217Removal of time limits on publication by HMRC

(1)

In Part 7 of FA 2004 (disclosure of tax avoidance schemes), in section 316C (publication by HMRC), omit subsections (6A) and (6B).

(2)

In Part 1 of Schedule 17 to F(No.2)A 2017 (disclosure of tax avoidance schemes: VAT and other indirect taxes), in paragraph 36 (publication by HMRC), omit sub-paragraphs (7) and (8).

218Consequential amendments

(1)

In paragraph 5 of Schedule 34 to FA 2014 (promoters of tax avoidance schemes: threshold conditions)—

(a)

in sub-paragraph (3)(a), for “the tribunal” substitute “an authorised officer”;

(b)

in sub-paragraph (4)(a)—

(i)

at the beginning insert “on appeal,”;

(ii)

for “section 118(2) of TMA 1970” substitute “section 315D(1) of FA 2004”;

(c)

for sub-paragraph (6) substitute—

“(6)

For the purposes of this paragraph—

“appeal period” means—

(a)

the period during which an appeal could be brought against the determination of an authorised officer or the tribunal, as applicable, or

(b)

where an appeal mentioned in paragraph (a) has been brought, the period during which that appeal has not been finally determined, withdrawn or otherwise disposed of;

“authorised officer” means an officer of Revenue and Customs who is, or is a member of a class of officers who are, authorised by HMRC for the purposes of the provision concerned.”.

(2)

In paragraph 5 of Schedule 13 to FA 2020 (joint and several liability of company directors), for sub-paragraph (6)(a) substitute—

“(a)

sections 315 and 315A of FA 2004 (penalties for non-disclosure of tax avoidance schemes);”.

(3)

In section 132A(2) of the Social Security Administration Act 1992 (disclosure of contributions avoidance arrangements)—

(a)

in paragraph (a), at the end insert “or to a penalty under that Part”;

(b)

in paragraph (b)—

(i)

for “section 98C of the Taxes Management Act 1970 (penalties for failure to comply with Part 7 of the Finance Act 2004) and any other” substitute “any”;

(ii)

for “that section” substitute “Part 7 of the Finance Act 2004”.

(4)

In FA 2022—

(a)

in section 90(3) (freezing orders: interpretation etc)—

(i)

omit paragraph (a);

(ii)

omit paragraph (d);

(b)

in Schedule 13 (penalties for facilitating avoidance schemes involving non-resident promoters), in paragraph 1(4), for paragraph (a) substitute—

“(a)

section 315 or 315A of FA 2004 (disclosure of tax avoidance schemes);”.

219Commencement

The amendments made by sections 216 and 218 do not have effect in relation to a penalty for which proceedings have been commenced under section 100C TMA or paragraph 45 of Schedule 17 to F(No.2)A 2017 before sections 216 and 218 come into force.

Construction industry scheme: amendments

220Construction industry scheme: amendments

(1)

Chapter 3 of Part 3 of FA 2004 (construction industry scheme) is amended as follows.

(2)

After section 62 insert—

“Liability for things done in the knowledge of deliberate failures to comply

62APayments made in the knowledge of deliberate failures to comply

(1)

This section applies to a person who—

(a)

has made a payment under a construction contract, and

(b)

before making a payment, knew or should have known that a connected party had deliberately failed, or would deliberately fail, to comply with a requirement to—

(i)

deduct a sum under section 61,

(ii)

pay a sum to the Commissioners under section 62, or

(iii)

deduct or pay an amount to His Majesty’s Revenue and Customs under PAYE regulations.

(2)

If this section applies, an officer of Revenue and Customs may determine that the person is liable to pay to the Commissioners an amount equal to 20% of the payment referred to in subsection (1).

(3)

In this section, a “connected party” is

(a)

another party to the construction contract referred to in subsection (1)(a), or

(b)

a party to another construction contract relating to the same construction operations as the construction contract referred to in subsection (1)(a).

62BReturns made in the knowledge of deliberate failures to comply

(1)

This section applies to a person who—

(a)

makes a return which treats a sum as deducted and paid on account of the person’s liabilities under section 62(2) or (3), and

(b)

before doing so, knew or should have known that the sum—

(i)

had not been deducted, or

(ii)

had deliberately not been, or would deliberately not be, paid on account of the person’s liabilities.

(2)

If this section applies, an officer of Revenue and Customs may determine that the person is liable to pay to the Commissioners an amount equal to the sum which the return treats as paid on account of the person’s liabilities.

62CRegulations

The Commissioners may make regulations with respect to the determination, collection and recovery of amounts described in sections 62A(2) and 62B(2).”.

(3)

In section 66—

(a)

after subsection (3) insert—

“(3A)

The Commissioners may at any time make a determination cancelling a person’s registration for gross payment if—

(a)

section 62A (payments made in the knowledge of deliberate failures to comply), or

(b)

section 62B (returns made in the knowledge of deliberate failures to comply),

applies to the person.”;

(b)

in subsection (4)—

(i)

for “the Board” substitute “the Commissioners”;

(ii)

after “subsection (3)” insert “or subsection (3A)”;

(c)

in subsection (6)—

(i)

the words from “the person must” to the end become paragraph (a);

(ii)

after that paragraph insert “, and

(b)

the person may not, within the period of one year beginning with the day on which the cancellation takes effect (see subsection (2) and section 67(5)), apply for registration for gross payment.”;

(d)

in subsection (7)—

(i)

after “subsection (3)” insert “or subsection (3A)”;

(ii)

for the words from “the person may” to the end substitute—

“(a)

the person may, if the Commissioners think fit, be registered for payment under deduction, and

(b)

the person may not, within the period of five years beginning with the day on which the cancellation takes effect (see subsection (4)), apply for registration for gross payment.”;

(e)

omit subsection (8).

(4)

In section 72, in the heading, at the end insert “: false statements and documentation”.

(5)

After section 72 insert—

“72APenalties: deliberate failures to comply

(1)

A person is liable to a penalty not exceeding 30% of any amount that they are determined to be liable to pay under section 62A (payments made in the knowledge of deliberate failures to comply) or 62B (returns made in the knowledge of deliberate failures to comply).

(2)

A penalty under this section may not be determined more than three years after the date on which the determination under section 62A or 62B becomes final.

(3)

For the purposes of subsection (2) and section 72B(3), a determination becomes final at the time when the period for any appeal or further appeal relating to the determination expires or, if later, when any appeal or final appeal relating to the penalty is finally determined.

(4)

Section 103(4) TMA 1970 (time limits) does not apply to a penalty under this section.

72BPenalties under section 72A: officers’ liability

(1)

Where—

(a)

a company is liable to a penalty under section 72A, and

(b)

the actions of the company which give rise to that liability were attributable to an officer of the company,

the officer is liable to pay such portion of the penalty (which may be equal to or less than 100%) as the Commissioners may specify in a notice given to the officer (a “decision notice”).

(2)

Before giving the officer a decision notice, the Commissioners must—

(a)

inform the officer that they are considering doing so, and

(b)

afford the officer the opportunity to make representations about whether a decision notice should be given or the portion that should be specified.

(3)

A decision notice—

(a)

may not be given before the amount of the penalty due from the company has been determined (but it may be given immediately after that has happened), and

(b)

may not be given more than three years after the date on which the determination mentioned in section 72A(1) becomes final.

(4)

Where the Commissioners have specified a portion of the penalty in a decision notice given to the officer—

(a)

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,

(b)

the specified portion shall be recoverable as if it were tax due from the officer, and

(c)

a further decision notice may be given in respect of a portion of any additional penalty for which the company is determined to be liable.

(5)

The Commissioners may not recover more than 100% of the penalty through issuing decision notices in relation to two or more persons.

(6)

A person is not liable to pay an amount by virtue of this section if the actions of the company concerned are attributable to the person by reference to conduct for which the person has been convicted of an offence.

In this subsection “conduct” includes omissions.

(7)

In this section and section 72C—

“company” means a body corporate or unincorporated association;

“officer” means—

(a)

in relation to a body corporate other than one whose affairs are managed by its members—

(i)
a director, manager, secretary or other similar officer of the body, or a person purporting to act in such a capacity, or

(ii)
a shadow director within the meaning of section 251 of the Companies Act 2006;

(b)

in relation to a limited liability partnership or other body corporate whose affairs are managed by its members—

(i)
a member who exercises management functions with respect to it, or purports to do so, or

(ii)
in the case of a limited liability partnership, a shadow member;

(c)

in relation to an unincorporated association, a person who exercises functions of management with respect to it, or purports to do so;

“shadow member” means a person in accordance with whose directions or instructions the members of a limited liability partnership are accustomed to act, save that a person is not a shadow member by reason only of the fact that the members act on advice given by that person in a professional capacity.

72CAppeals in relation to a decision notice under section 72B

(1)

An officer may appeal—

(a)

the decision to give a decision notice under section 72B, including on the grounds that the company is not liable to the penalty under section 72A to which the decision notice relates;

(b)

the amount of the specified portion.

(2)

Notice of an appeal must—

(a)

state the ground of appeal, and

(b)

be given in writing to HMRC before the end of the period of 30 days beginning with the day on which the decision notice was given to the officer.

(3)

The provisions of Part 5 of TMA 1970 relating to appeals have effect in relation to appeals under this section as they have effect in relation to an appeal against an assessment to income tax.”

(6)

In section 75, at the end insert—

“(4)

In this Chapter “the Commissioners” means the Commissioners for His Majesty’s Revenue and Customs.”.

221Construction industry scheme regulations: amendments

(1)

The Income Tax (Construction Industry Scheme) Regulations 2005 (S.I. 2005/2045) are amended as follows.

(2)

After regulation 13 insert—

“Determination of amounts payable as a result of things done in the knowledge of deliberate failures to comply and appeal against determination13A.

(1)

This regulation applies if a determination is made under section 62A(2) (payments made in the knowledge of deliberate failures to comply) or 62B(2) (returns made in the knowledge of deliberate failures to comply) of the Act.

(2)

An officer of Revenue and Customs must serve notice of the determination on the person to whom it relates.

(3)

The determination may cover one or more amounts the person is liable to pay under section 62A(2) or 62B(2) of the Act.

(4)

The determination is subject to Parts 4, 5, 5A and 6 of TMA (assessment, appeals, collection and recovery) as if—

(a)

the determination were an assessment, and

(b)

the amount determined were income tax charged on the person,

and those Parts of that Act apply accordingly with any necessary modifications, except that the amount determined is due and payable 14 days after the determination is made.”

(3)

In regulation 16—

(a)

in paragraph (1)—

(i)

the words from “a contractor” to the end become paragraph (a);

(ii)

after that paragraph insert “, or

(b)

a person is liable to pay under regulation 13A(2).”;

(b)

in paragraph (3), in Table 1, in the first row, for “and 13(2)” substitute “, 13(2) and 13A(2)”.

222Commencement

(1)

Subject to subsection (2), the amendments made by sections 220 and 221 have effect from 6 April 2026.

(2)

The amendments made by section 220(3)(d)(ii) and 220(3)(e)have effect in relation to a determination under section 66(3) of FA 2004 if the determination is made by reference to behaviour occurring on or after 6 April 2026.