Finance Act 2022

First, second and further failures

21 (1) This paragraph applies for determining whether a company’s or partnership’s failure to give a notification in accordance with paragraph 8(2)(a) is, in respect of a relevant tax—

(a) a first failure,

(b) a second failure, or

(c) a further failure.

(2) The failure is a first failure in respect of a relevant tax if, in the applicable three year period, the company or partnership has not been assessed to a penalty under paragraph 20(1) in respect of the same relevant tax.

(3) The failure is a second failure in respect of a relevant tax if, in the applicable three year period, the company or partnership—

(a) has been assessed to a penalty under paragraph 20(1) for a first failure in respect of the same relevant tax, but

(b) has not been assessed to a penalty under paragraph 20(1) for a second or further failure in respect of the same relevant tax.

(4) The failure is a further failure in respect of a relevant tax if, in the applicable three year period, the company or partnership has been assessed to a penalty under paragraph 20(1) for a second or further failure in respect of the same relevant tax.

(5) The “applicable three year period” is the period comprising the three financial years of the company or partnership immediately preceding the financial year for which the relevant return, in relation to which the notification was required, was delivered to HMRC.