Citation and commencement

1.-(1) These Regulations may be cited as the International Tax Compliance (Crown Dependencies and Gibraltar) (Amendment) Regulations 2015.

(2) These Regulations come into force on 15th April 2015.

Amendment of the International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014

2.-(1) The International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014(3) are amended as follows.

(2) In regulation 3-

(a)in paragraph (4)(b) omit "from the activities undertaken on behalf of person A by person B",

(b)in paragraph (7)(b) after "holds" insert "financial", and

(c)in paragraph (9) omit "(a)(i)".

(3) In regulation 8-

(a)omit paragraph (2), and

(b)in paragraph (3) for "The institution must send a return under this regulation to an officer of Revenue and Customs" substitute "The return must be submitted electronically in accordance with regulation 8A".

(4) After regulation 8 insert-

"Electronic return system

8A.-(1) The return must be made electronically using an electronic return system.

(2) An electronic return system is the form and manner specified in specific or general directions given by the Commissioners for Her Majesty's Revenue and Customs.

(3) A return which is made in a form or manner otherwise than by an electronic return system is treated as not having been made.

(4) An electronic return system must incorporate an electronic validation process.

(5) Unless the contrary is proved-

(a)the use of an electronic return system is presumed to have resulted in the making of the return only if this has been successfully recorded as such by the relevant electronic validation process,

(b)the time of making the return using an electronic return system is presumed to be the time recorded as such by the relevant electronic validation process, and

(c)the person delivering the return is presumed to be the person identified as such by any relevant feature of the electronic return system.

(6) A return made using an electronic return system on behalf of a reporting financial institution is taken to have been made by that institution, unless the institution proves that the return was made without the institution's authority."

(5) After regulation 10 insert-

"Daily default penalty

10A.  If-

(a)a penalty under regulation 10 is assessed, and

(b)the failure in question continues after the person has been notified of the assessment,

the person is liable to a further penalty, for each subsequent day on which the failure continues, of an amount not exceeding £60 for each such day."

(6) In regulation 12(1), after "10" insert ", 10A".

(7) In regulation 13-

(a)in paragraph (1), after "10" insert ", 10A", and

(b)in paragraph (3), after "10" insert "or 10A".

(8) In regulation 14(a), after "10" insert ", 10A".

(9) After regulation 15 insert-

"Increased daily default penalty

15A.-(1) This paragraph applies if-

(a)a penalty under regulation 10A is assessed under regulation 13,

(b)the failure in respect of which that assessment is made continues for more than 30 days beginning with the date on which notification of that assessment is given, and

(c)the person has been told that an application may be made under this paragraph for an increased daily penalty to be imposed.

(2) If this regulation applies, an officer of Revenue and Customs may make an application to the tribunal for an increased daily penalty to be imposed on the person.

(3) If the tribunal decides that an increased daily penalty should be imposed then for each applicable day on which the failure continues-

(a)the person is not liable to a penalty under regulation 10A in respect of the failure, and

(b)the person is liable instead to a penalty under this regulation of an amount determined by the tribunal.

(4) The tribunal may not determine an amount exceeding £1000 for each applicable day.

(5) If a person becomes liable to a penalty under this regulation, HMRC must notify the person.

(6) The notification must specify the day from which the increased penalty is to apply.

(7) That day and any subsequent day is an "applicable day" for the purposes of this regulation."

EXPLANATORY NOTE

(This note is not part of the Regulations)

These Regulations amend the International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014 which give effect to four agreements to improve international tax compliance. The agreements are those made between the Government of the United Kingdom of Great Britain and Northern Ireland, and each of the Government of the Isle of Man (signed on 10th October 2013), the States of Guernsey (signed on 22nd October 2013), the Government of Jersey (signed on 22nd October 2013) and the Government of Gibraltar (signed on 21st November 2013).

These Regulations amend the definition of "reporting financial institution" to better reflect the definitions in the agreements, remove the requirement to make nil returns, introduce a requirement for electronic returns, insert provisions for a daily default penalty and an increased daily default penalty and make amendments which are consequential to these changes.

A Tax Information and Impact Note covering the International Tax Compliance (Crown Dependencies and Gibraltar) Regulations 2014 was published on 12th December 2013 alongside a draft of those regulations and is available on the HMRC website at http://www.hmrc.gov.uk/thelibrary/tiins.htm. It remains an accurate summary of the impacts that apply to this instrument.