Taxes Management Act 1970

93 Failure to make return for income tax or capital gains tax

(1) If any person has been required by a notice served under or for the purposes of section 8 or 9 of this Act (or either of those sections as extended by section 12 of this Act or section 39(3) of the principal Act (husband and wife)) to deliver any return, and he fails to comply with the notice he shall be liable, subject to the provisions of this section—

(a) to a penalty not exceeding, except in the case mentioned in subsection (2) below, £50, and

(b) if the failure continues after it has been declared by the court or Commissioners before whom proceedings for the penalty have been commenced, to a further penalty not exceeding £10 for each day on which the failure so continues.

(2) If the failure continues after the end of the year of assessment following that during which the notice was served, the penalty under subsection (1)(a) above shall be an amount not exceeding the aggregate of £50 and the total amount of the tax with which the said person is charged (whether for one or for more than one year of assessment) in assessments—

(a) based wholly or partly on any income or chargeable gains that ought to have been included in the return required by the notice, and

(b) made after the end of the year next following the year of assessment in which the said notice was served.

(3) Where in any year of assessment any amount was deducted from the said person's emoluments under section 204 of the principal Act (pay as you earn), and that amount exceeds the total amount (if any) charged in any assessments under Schedule E made on him for that year before the end of the year of assessment next following that in which the said notice was served, the amount of the excess shall be treated, for the purposes of subsection (2) of this section, as reducing the amount of the tax charged in assessments under Schedule E made on him for the first-mentioned year after the end of the said following year.

(4) The reference in subsection (2) above to tax includes surtax, except that in relation to a return required for the purposes of section 9 of this Act it does not include any tax not chargeable in the partnership name; and in relation to a person's failure to deliver any other return it does not include tax assessed in the name of a partnership on so much of the profits or gains assessed as falls to be included in the total income of any other person.

(5) Except in the case mentioned in subsection (2) above, a person shall not be liable to any penalty incurred under this section for a failure to comply with any notice, if the failure is remedied before proceedings for the recovery of the penalty are commenced.

(6) Where a person is liable to more than one penalty of an amount determined under subsection (2) above, any assessment taken into account for the purposes of one of those penalties shall be left out of account for the purposes of the other or others.

(7) If the defendant (or, in Scotland, the defender) in proceedings under this section proves that there was no income and no chargeable gains to be included in the return, the penalty shall not exceed £5.

(8) References in this section to the amount of tax with which a person is charged for any year of assessment and to assessments made on him include, in the case of a person who has died, references to any amount with which his personal representatives are charged for that year and to assessments made on them.