Finance Act 2017

Part 1 Penalties

Sections 48(2) and 53(1): requirements imposed by regulations

1 (1) A person who fails to comply with a requirement imposed by regulations under section 48(2) or 53(1)(a) is liable to a penalty.

(2) The amount of the penalty is equal to the relevant amount multiplied by the number of days on which the failure continues (up to a maximum of 100 days) or, if it is greater, to a penalty of £50.

(3) In relation to a failure by a person to comply with the requirement, the amount of the penalty is to be determined by reference to the number of occasions in the period of 2 years preceding the beginning of the failure on which the person has previously failed to comply with that requirement.

(4) But—

(a) a continuing failure to comply with a requirement is to be regarded as one occasion of failure occurring on the date on which the failure began;

(b) if the same omission gives rise to a failure to comply with more than one such requirement, it is to be regarded as the occasion of only one failure.

(5) The relevant amount is—

(a) if there has been no previous occasion of failure in the period mentioned in sub-paragraph (3), £5;

(b) if there has been only one such occasion in that period, £10; and

(c) in any other case, £15.

(6) A person who fails to comply with a requirement to preserve records imposed by regulations under section 53(1)(b) is liable to a penalty of £500.

(7) If by reason of conduct falling within sub-paragraph (1) or (6) a person is assessed to a penalty for a deliberate inaccuracy under Schedule 24 to FA 2007, that conduct does not also give rise to a penalty under this paragraph.

Section 53(2): requirements imposed by directions

2 (1) A person who fails to comply with a requirement imposed under section 53(2)(a) is liable to a penalty.

(2) The amount of the penalty is equal to £200 multiplied by the number of days on which the failure continues (up to a maximum of 30 days).

(3) A person who fails to comply with a requirement imposed under section 53(3)(b) is liable to a penalty of £500.

(4) If by reason of conduct falling within sub-paragraph (1) or (3) a person is assessed to a penalty for a deliberate inaccuracy under Schedule 24 to FA 2007, that conduct does not also give rise to a penalty under this paragraph.

Power to alter amounts specified in paragraphs 1 and 2

3 (1) If it appears to the Treasury that there has been a change in the value of money since the last relevant date, they may by regulations substitute for the sums specified in paragraph 1(2), (5)(a) to (c) and (6) and paragraph 2(2) and (3) such other sums as appear to them to be justified by the change.

(2) But regulations under sub-paragraph (1) may not apply to a failure which began before the date on which the regulations come into force.

(3) The “relevant date”, in relation to a specified sum, means—

(a) the date on which this Act is passed, and

(b) each date on which the power conferred by sub-paragraph (1) has been exercised in relation to that sum.

Reasonable excuse

4 (1) A failure by any person to comply with any requirement mentioned in paragraph 1 or 2 does not give rise to a liability to a penalty under this Schedule if the person concerned satisfies—

(a) the Commissioners, or

(b) on appeal, a tribunal,

that there is a reasonable excuse for the failure.

(2) A failure for which there is a reasonable excuse is to be disregarded for the purposes of paragraph 1(5).

(3) For the purposes of this paragraph, in the case of a person (P)—

(a) an insufficiency of funds is not a reasonable excuse unless attributable to events outside P’s control;

(b) where P relies on another person to do anything, that is not a reasonable excuse unless P took reasonable care to avoid the relevant failure;

(c) where P had a reasonable excuse for the failure but the excuse has ceased, P is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased.