Finance Act 2014

Allocation and distribution of promoter reference number

250 Allocation of promoter reference number

(1) Where a monitoring notice is given to a person (“the monitored promoter”) HMRC must as soon as practicable after the end of the appeal period—

(a) allocate the monitored promoter a reference number, and

(b) notify the relevant persons of that number.

(2) “Relevant persons” means—

(a) the monitored promoter, and

(b) if the monitored promoter is resident outside the United Kingdom, any person who HMRC know is an intermediary in relation to a relevant proposal of the monitored promoter.

(3) The “appeal period” means—

(a) the period during which an appeal could be brought against the approval by the tribunal of the giving of the monitoring notice, 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mentioned in paragraph (a) has been brought, the period during which that appeal has not been finally determined, withdrawn or otherwise disposed of.

(4) The duty in subsection (1) does not apply if the monitoring notice is set aside following an appeal.

(5) A number allocated to a person under this section is referred to in this Part as a “promoter reference number”.

(6) Where the monitoring notice mentioned in subsection (1) is a replacement monitoring notice—

(a) in subsection (1) the reference to the end of the appeal period is to be read as a reference to whichever is the later of the end of the appeal period for the original monitoring notice and the date the replacement monitoring notice takes effect, and

(b) in subsection (4) the reference to the monitoring notice is to be read as a reference to the original monitoring notice.

251 Duty of monitored promoter to notify clients and intermediaries of number

(1) This section applies where a person who is a monitored promoter (“the monitored promoter”) is notified under section 250 of a promoter reference number.

(2) The monitored promoter must, within the relevant period, notify the promoter reference number to—

(a) any person who has become its client at any time in the period beginning with the day on which the monitoring notice in relation to the monitored promoter took effect and ending with the day on which the monitored promoter was notified of that number,

(b) any person who becomes its client after the end of the period mentioned in paragraph (a) but while the monitoring notice has effect,

(c) any person who the monitored promoter could reasonably be expected to know falls within subsection (4), and

(d) any person who the monitored promoter could reasonably be expected to know is a relevant intermediary in relation to a relevant proposal of the monitored promoter.

(3) A person (“C”) becomes a client of a monitored promoter if the promoter does any of the following in relation to C—

(a) makes a firm approach to C in relation to a relevant proposal with a view to the promoter making the proposal available for implementation by C or another person;

(b) makes a relevant proposal available for implementation by C;

(c) takes part in the organisation or management of relevant arrangements entered into by C.

(4) A person falls within this subsection if during the period beginning with the date the conduct notice took effect and ending with the date on which the monitoring notice took effect the person has entered into transactions forming part of relevant arrangements and those arrangements—

(a) enable, or are likely to enable, the person to obtain a tax advantage during the time a monitoring notice has effect, and

(b) are either relevant arrangements in relation to which the monitored promoter is or was a promoter or implement a relevant proposal in relation to which the monitored promoter was a promoter.

(5) A person is a relevant intermediary in relation to a relevant proposal of a monitored promoter if the person meets the conditions in section 236(a) to (c) (meaning of “intermediary”) at any time while the monitoring notice in relation to the monitored promoter has effect.

(6) The “relevant period” means—

(a) in the case of a person falling within subsection (2)(a), the period of 30 days beginning with the day of the notification mentioned in subsection (1),

(b) in the case of a person falling within subsection (2)(b), the period of 30 days beginning with the day on which the person first became a client in relation to the monitored promoter,

(c) in the case of a person falling within subsection (2)(c), the period of 30 days beginning with the later of the day of the notification mentioned in subsection (1) and the first day on which the monitored promoter could reasonably be expected to know that the person fell within subsection (4), and

(d) in the case of a person falling within subsection (2)(d), the period of 30 days beginning with the later of the day of the notification mentioned in subsection (1) and the first day on which the monitored promoter could reasonably be expected to know that the person was a relevant intermediary in relation to a relevant proposal of the monitored promoter.

(7) In this section “the conduct notice” means the conduct notice that the monitored promoter failed to comply with which resulted in the monitoring notice being given to the monitored promoter.

(8) Subsection (2)(c) is to be ignored in a case where the monitoring notice is a replacement monitoring notice.

252 Duty of those notified to notify others of promoter’s number

(1) In this section “notified client” means—

(a) a person who is notified of a promoter reference number under section 250 by reason of being a person falling within subsection (2)(b) of that section, and

(b) a person who is notified of a promoter reference number under section 251.

(2) A notified client must, within 30 days of being notified as described in subsection (1), provide the promoter reference number to any other person who the notified client might reasonably be expected to know has become, or is likely to have become, a client in relation to the monitored promoter concerned at a time when the monitoring notice in relation to that monitored promoter had effect.

(3) A person (“C”) becomes a client of a monitored promoter if the promoter does any of the following in relation to C—

(a) makes a firm approach to C in relation to a relevant proposal with a view to the promoter making the proposal available for implementation by C or another person;

(b) makes a relevant proposal available for implementation by C;

(c) takes part in the organisation or management of relevant arrangements entered into by C.

(4) Where the notified client is an intermediary in relation to a relevant proposal of the monitored promoter concerned, the notified client must also, within 30 days, provide the promoter reference number to—

(a) any person to whom the notified client has, since the monitoring notice in relation to the monitored promoter concerned took effect, communicated in the course of a business information about a relevant proposal of the monitored promoter, and

(b) any person who the notified client might reasonably be expected to know has, since that monitoring notice took effect, entered into, or is likely to enter into, transactions forming part of relevant arrangements in relation to which that monitored promoter is a promoter.

(5) Subsection (2) or (4) does not impose a duty on a notified client to notify a person of a promoter reference number if the notified client reasonably believes that the person has already been notified of the promoter reference number (whether as a result of a duty under this section or as a result of any of the other provision of this Part).

253 Duty of persons to notify the Commissioners

(1) If a person (“N”) is notified of a promoter reference number under section 250, 251 or 252, N must report the number to the Commissioners if N expects to obtain a tax advantage from relevant arrangements in relation to which the monitored promoter to whom the reference number relates (whether that is N or another person) is the promoter.

(2) A report under this section—

(a) must be made in (or, if prescribed circumstances exist, submitted with) each tax return made by N for a period that is or includes a period for which the arrangements enable N to obtain a tax advantage (whether in relation to the tax to which the return relates or another tax);

(b) if no tax return falls within paragraph (a), or in the case mentioned in subsection (3), must contain such information, and be made in such form and manner and within such time, as is prescribed.

(3) The case is that the tax return in which the report would (apart from this subsection) have been made is not submitted—

(a) by the filing date, or

(b) if there is no filing date in relation to the tax return concerned, by such other time that the tax return is required to be submitted by or under any enactment.

(4) Where N expects to obtain the tax advantage referred to in subsection (1) in respect of inheritance tax, stamp duty land tax, stamp duty reserve tax or petroleum revenue tax—

(a) subsection (2) does not apply in relation to that tax advantage, and

(b) a report under this section in respect of that tax must be in such form and manner and contain such information and be made within such time as is prescribed.

(5) Where the relevant arrangements referred to in subsection (1) give rise to N making a claim under section 261B of TCGA 1992 (treating trade loss as CGT loss) or for loss relief under Part 4 of ITA 2007 and that claim is not contained in a tax return, a report under this section must also be made in that claim.

(6) In this section “tax return” means any of the following—

(a) a return under section 8 of TMA 1970 (income tax and capital gains tax: personal return);

(b) a return under section 8A of TMA 1970 (income tax and capital gains tax: trustee’s return);

(c) a return under section 12AA of TMA 1970 (income tax and corporation tax: partnership return);

(d) a company tax return under paragraph 3 of Schedule 18 to the FA 1998 (company tax return);

(e) a return under section 159 or 160 of FA 2013 (returns and further returns for annual tax on enveloped dwellings).