PART 5

Promoters of tax avoidance schemes

Conduct notices

Duty to give conduct notice: defeat of promoted arrangements
237A
1
If an authorised officer becomes aware at any time (“
the relevant time
”) that a person (
“ P ”
) who is carrying on a business as a promoter meets any of the conditions in subsections (11) to (13), the officer must determine whether or not P's meeting of that condition should be regarded as significant in view of the purposes of this Part.
But see also subsection (14).
2
An authorised officer must make the determination set out in subsection (3) if the officer becomes aware at any time (
“ the section 237A(2) relevant time ”
) that—
a
a person meets a condition in subsection (11), (12) or (13), and
b
at the section 237A(2) relevant time another person (“P”), who is carrying on a business as a promoter, meets that condition by virtue of Part 4 of Schedule 34A (meeting the section 237A conditions: bodies corporate and partnerships).
3
The authorised officer must determine whether or not—
a. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b
P's meeting of the condition as mentioned in subsection (2)(b),
should be regarded as significant in view of the purposes of this Part.
3A
In determining under subsection (3) whether or not P's meeting of the condition should be regarded as significant, the authorised officer must determine whether the meeting of that condition by the person mentioned in subsection (2)(a) should be regarded as significant in view of the purposes of this Part.
3B
If the officer determines that the meeting of the condition by that person should be regarded as significant, the officer must determine that P's meeting of that condition should be regarded as significant.
3C
If a person meets a condition in subsection (11), (12) or (13) and the person falls within the case described in paragraph 2 of Schedule 33A (multiple entity promoter), the authorised officer must determine (whether under subsection (1) or (3)(a) or (b)) that the meeting of the condition should be regarded as significant.
4
Subsections (1) and (2) do not apply if a conduct notice or monitoring notice already has effect in relation to P.
5
Subsection (1) does not apply if, at the relevant time, an authorised officer is under a duty to make a determination under section 237(5) in relation to P.
6
Subsection (2) does not apply if, at the section 237A(2) relevant time, an authorised officer is under a duty to make a determination under section 237(5) in relation to P.
7
But in a case where subsection (1) does not apply because of subsection (5), or subsection (2) does not apply because of subsection (6), subsection (5) of section 237 has effect as if—
a
the references in paragraph (a) of that subsection to “subsection (1)”, and “subsection (1)(a)” included subsection (1) of this section, and
b
in paragraph (b) of that subsection the reference to “subsection (1A)(a)” included a reference to subsection (2)(a) of this section and the reference to subsection (1A)(b) included a reference to subsection (2)(b) of this section.
8
If the authorised officer determines under subsection (1) that P's meeting of the condition in question should be regarded as significant, the officer must give P a conduct notice, unless subsection (10) applies.
9
If the authorised officer determines under subsection (3) that—
a. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
b
P's meeting of the condition as mentioned in subsection (2)(b),
should be regarded as significant in view of the purposes of this Part, the officer must give P a conduct notice, unless subsection (10) applies.
10
This subsection applies if the authorised officer determines that, having regard to the extent of the impact that P's activities as a promoter are likely to have on the collection of tax, it is inappropriate to give P a conduct notice.
11
The condition in this subsection is that in the period of 3 years ending with the relevant time at least 3 relevant defeats have occurred in relation to P.
12
The condition in this subsection is that at least two relevant defeats have occurred in relation to P at times when a single defeat notice under section 241A(2) or (6) had effect in relation to P.
13
The condition in this subsection is that at least one relevant defeat has occurred in relation to P at a time when a double defeat notice under section 241A(3) had effect in relation to P.
14
A determination that the condition in subsection (12) or (13) is met cannot be made unless—
a
the defeat notice in question still has effect when the determination is made, or
b
the determination is made on or before the 90th day after the day on which the defeat notice in question ceased to have effect.
15
Schedule 34A sets out the circumstances in which a “relevant defeat” occurs in relation to a person and includes provision limiting what can amount to a further relevant defeat in relation to a person (see paragraph 6).
Pt. 5 applied (with modifications) by 1992 c. 4, s. 11A(1)(3) (as inserted (with effect in accordance with Sch. 1 para. 35 of the amending Act) by National Insurance Contributions Act 2015 (c. 5), Sch. 1 para. 3)
Pt. 5 applied (with modifications) by 1992 c. 7 (N.I.), s. 11A(1)(3) (as inserted (with effect in accordance with Sch. 1 para. 35 of the amending Act) by National Insurance Contributions Act 2015 (c. 5), Sch. 1 para. 12)
Pt. 5 modified (12.2.2015 for specified purposes, 12.4.2015 in so far as not already in force) by National Insurance Contributions Act 2015 (c. 5), Sch. 2 Pt. 2, Sch. 2 para. 33(2)
Pt. 5 applied (with modifications) by Social Security Contributions and Benefits Act 1992 (c. 4), s. 16(1)(d) (as inserted (12.4.2015) by National Insurance Contributions Act 2015 (c. 5), Sch. 2 para. 32)
Ss. 237A-237D inserted (15.9.2016) by Finance Act 2016 (c. 24), s. 160(2)
S. 237A modified (15.9.2016) by Finance Act 2016 (c. 24), s. 160(20)(21)
S. 237A modified (15.9.2016) by Finance Act 2016 (c. 24), s. 160(22)
S. 237A(3A)(3B) inserted (with effect in accordance with s. 121(6) of the amending Act) by Finance Act 2021 (c. 26), Sch. 30 para. 22(2)(b)
S. 237A(3)(a) omitted (with effect in accordance with s. 121(6) of the amending Act) by virtue of Finance Act 2021 (c. 26), Sch. 30 para. 22(2)(a)
S. 237A(9)(a) omitted (with effect in accordance with s. 121(6) of the amending Act) by virtue of Finance Act 2021 (c. 26), Sch. 30 para. 22(2)(c)
S. 237A(3C) inserted (with effect in accordance with s. 121(6) of the amending Act) by Finance Act 2021 (c. 26), Sch. 30 para. 12