Part 3: Power to obtain tax agent’s files etc
18.Paragraph 7 sets out two cases in which relevant documents may be required by a file access notice. Case A is where a conduct notice has been given without an appeal being made or once the appeal has been resolved. Case B is where an individual has been convicted of a tax related offence of dishonesty but only if it occurred after they became a tax agent. The capacity in which the offence was committed does not matter. In both Cases A and B the tribunal must approve the file access notice.
19.Paragraph 8 allows an officer to require relevant documents by a file access notice to the agent or anyone else who holds the documents.
20.Paragraph 9 describes “relevant documents”. These are any documents used by a tax agent in assisting clients with their tax affairs and can be required even if the agent does not own them.
21.Paragraph 10 describes the documents which can be required under a file access notice.
22.Paragraphs 11 and 12 describe how a tax agent may comply with the contents of a file access notice.
23.Sub-paragraph (1) of paragraph 13 sets out the conditions for approval by the tribunal of the file access notice.
24.Sub-paragraphs (1)(b) and (c) set out that before approving the file access notice the tribunal must be satisfied that there has been dishonest conduct or a relevant conviction, and that the notice is justified in the circumstances.
25.Sub-paragraphs (1)(d) and (e) put conditions on HMRC (in addition to any other requirements deriving from tribunal rules).
26.Sub-paragraph (3) provides that the tribunal’s decision is final. But there is a further right of appeal for a document-holder who is not the tax agent under paragraph 20 below.
27.Paragraphs 14 and 15 set out restrictions on documents that can be required by a file access notice: documents not in the document-holder’s possession or power, material that relates to a pending tax appeal, or which is journalistic or personal.
28.Paragraph 16 provides that a file access notice cannot require production of documents which are more than 20 years old unless the document is of continuing relevance to tax.
29.Paragraph 17 concerns privileged material. Under sub-paragraph (1), a document-holder is not required to provide such material. Sub-paragraph (2) defines privileged material, and sub-paragraph (3) applies regulations made under Schedule 36 to the Finance Act (FA) 2008, covering disputes about whether a document is privileged.
30.Paragraphs 18 and 19 allow HMRC to copy and retain the documents provided and describe the conditions that apply to retention.
31.Paragraph 20 provides a right of appeal against the file access notice on the grounds of onerousness for a document-holder (a third party) who is not the tax agent. It sets out the procedure and the tribunal’s powers.
32.Paragraph 21 provides for a criminal offence where a person disposes of a document required by a file access notice (a required document).
33.Paragraph 22 provides for a civil penalty for failure to comply with a file access notice.
34.Paragraph 23 provides for a daily civil penalty for a continuing failure to comply with a file access notice. This does not apply if a person cannot comply with the notice because the document in question has been destroyed, since it is no longer in the person’s possession or power.
35.Paragraph 24 says that where an officer of HMRC allows extra time for a requirement to be complied with, which is then met, there is no liability to a penalty.
36.Paragraph 25 provides that if a person has a reasonable excuse there is no liability to a penalty. Sub-paragraph (2) sets out circumstances which do not count as a reasonable excuse.
