Finance Act 2022

PART 2 Liability to a penalty

Penalty for making an electronic sales suppression tool

2 A person who makes an electronic sales suppression tool (including modifying a tool that is not an electronic sales suppression tool so that it becomes an electronic sales suppression tool) is liable to a penalty.

Penalty for supplying an electronic sales suppression tool

3 (1) A person (“P”) who supplies an electronic sales suppression tool to another person or other persons is liable to a penalty.

(2) Liability to a penalty under this paragraph does not arise if P satisfies HMRC or (on appeal) the tribunal that P was unaware that the tool P supplied to the other person or persons was an electronic sales suppression tool.

Penalty for promoting use of a tool to suppress an electronic sales record

4 (1) A person is liable to a penalty for each occasion on which the person promotes the use of a tool to suppress a relevant electronic sales record (whether or not the suppression of relevant electronic sales records is the main function, or one of the main functions, of the tool).

(2) A person promotes the use of a tool to suppress a relevant electronic sales record if the person communicates information about the tool to another person with a view to that other person, or any other person, using the tool to suppress a relevant electronic sales record.

Amount of a penalty under paragraph 2, 3 or 4

5 (1) The amount of a penalty to which a person is liable under paragraph 2, 3 or 4 is such amount, not exceeding £50,000, as an authorised HMRC officer considers appropriate.

(2) In determining the amount of a penalty under paragraph 2, 3 or 4, the officer—

(a) must take into account any matter specified in a notice published by HMRC, so far as that matter is relevant, and

(b) may take into account any other matter, so far as the officer considers it appropriate to do so.

(3) “Authorised HMRC officer” means an officer of Revenue and Customs who is, or is a member of a class of officers who are, authorised by the Commissioners for Her Majesty’s Revenue and Customs for the purposes of this paragraph.

Penalty for possession etc of an electronic sales suppression tool

6 (1) A person (“P”) is liable to a penalty not exceeding £1,000 if—

(a) P is in possession of, or has otherwise obtained access to, an electronic sales suppression tool, and

(b) condition 1 or 2 applies.

(2) Condition 1 is that—

(a) HMRC has notified P in writing that an officer of Revenue and Customs has reason to believe that P is in possession of, or has otherwise obtained access to, an electronic sales suppression tool, and

(b) P has not, within the period of 30 days beginning with the day on which the notice is given, satisfied an officer of Revenue and Customs that P is not (or is no longer) in possession of, and does not otherwise have access to, an electronic sales suppression tool.

(3) Condition 2 is that P has been assessed to an electronic sales suppression penalty within the period of five years ending with the first day on which an officer of Revenue and Customs has reason to believe that P may be liable to a penalty under this paragraph.

(4) For the purposes of this paragraph and paragraph 7—

(a) a person is in possession of an electronic sales suppression tool if the person possesses the tool in any manner;

(b) a person has access to an electronic sales suppression tool if the tool is available to the person to use to suppress a relevant electronic sales record;

(c) a person obtains access to an electronic sales suppression tool if the person takes any steps to have access to the tool.

(5) Accordingly, a person may be in possession of, or otherwise have access to, an electronic sales suppression tool whether or not—

(a) the person owns the tool,

(b) the person only has access to the tool remotely, or

(c) other persons also have access to the tool.

(6) Liability to a penalty under this paragraph does not arise if P has been assessed to a penalty under paragraph 2 or 3 in respect of the electronic sales suppression tool that P is in possession of, or has otherwise obtained access to.

(7) Liability to a penalty under this paragraph does not arise if P satisfies HMRC or (on appeal) the tribunal that P was unaware that the tool that P was in possession of, or had otherwise obtained access to, was an electronic sales suppression tool.

Daily default penalties

7 (1) This paragraph applies if—

(a) a person (“P”) is assessed to a penalty under paragraph 6 in respect of an electronic sales suppression tool, and

(b) after being notified of the assessment (see paragraph 11(1)(b)), P continues to be in possession of, or otherwise have access to, the tool.

(2) P is liable to a further penalty of an amount not exceeding £75 for each subsequent day on which P continues to be in possession of, or otherwise have access to, the tool.

(3) The total amount of the penalties to which a person may be liable under this paragraph may not exceed £50,000.