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Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 1 — Land transaction returns

    191

 

purchase a house by way of the rent to loan scheme in Part 3 of the Housing

(Scotland) Act 1987 (c. 26).

          (5)      The chargeable consideration for such a transaction is equal to the price that,

by virtue of section 62 of the Housing (Scotland) Act 1987 (c. 26), would be

payable for the house if the person were exercising the right to purchase

5

under section 61 of that Act.

Schedule 10

Section 78

 

Stamp duty land tax: returns, enquiries, assessments and appeals

Part 1

Land transaction returns

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Contents of return

  1       (1)      A land transaction return must—

              (a)             be in the prescribed form,

              (b)             contain the prescribed information, and

              (c)             include a declaration by the purchaser (or each of them) that the

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return is to the best of his knowledge correct and complete.

          (2)      In sub-paragraph (1) “prescribed” means prescribed by regulations made by

the Inland Revenue.

          (3)      The regulations may make different provision for different kinds of return.

          (4)      Regulations under sub-paragraph (1)(b) may require the provision of

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information corresponding to any of the particulars formerly required

under—

              (a)             Schedule 2 to the Finance Act 1931 (c. 28) (requirement to deliver

particulars of land transactions in Great Britain), or

              (b)             section 244 of the Finance Act 1994 (c. 9) (corresponding provision

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for Northern Ireland).

          (5)      The return is treated as containing any information provided by the

purchaser for the purpose of completing the return.

Meaning of filing date and delivery of return

  2       (1)      References in this Part of this Act to the filing date, in relation to a land

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transaction return, are to the last day of the period within which the return

must be delivered.

          (2)      References in this Part of this Act to the delivery of a land transaction return

are to the delivery of a return that—

              (a)             complies with the requirements of paragraph 1(1) (contents of

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return), and

              (b)             is accompanied by payment of any tax required to accompany the

return.

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 1 — Land transaction returns

    192

 

Failure to deliver return: flat-rate penalty

  3       (1)      A person who is required to deliver a land transaction return and fails to do

so by the filing date is liable to a flat-rate penalty under this paragraph.

                   He may also be liable to a tax-related penalty under paragraph 4.

          (2)      The penalty is—

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              (a)             £100 if the return is delivered within three months after the filing

date, and

              (b)             £200 in any other case.

Failure to deliver return: tax-related penalty

  4       (1)      A purchaser who is required to deliver a land transaction return in respect

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of a chargeable transaction and fails to do so within twelve months after the

filing date is liable to a tax-related penalty under this paragraph.

                   This is in addition to any flat-rate penalty under paragraph 3.

          (2)      The penalty is an amount not exceeding the amount of tax chargeable in

respect of the transaction.

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Formal notice to deliver return: daily penalty

  5       (1)      If it appears to the Inland Revenue—

              (a)             that a purchaser required to deliver a land transaction return in

respect of a chargeable transaction has failed to do so, and

              (b)             that the filing date has now passed,

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                   they may issue a notice requiring him to deliver a land transaction return in

respect of the transaction.

          (2)      The notice must specify—

              (a)             the transaction to which it relates, and

              (b)             the period for complying with the notice (which must not be less

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than 30 days from the date of issue of the notice).

          (3)      If the purchaser does not comply with the notice within the specified period,

the Inland Revenue may apply to the General or Special Commissioners for

an order imposing a daily penalty.

          (4)      On such an application the Commissioners may direct that the purchaser

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shall be liable to a penalty or penalties not exceeding £60 for each day on

which the failure continues after the day on which he is notified of the

direction.

          (5)      This paragraph does not affect, and is not affected by, any penalty under

paragraph 3 or 4 (flat-rate or tax-related penalty for failure to deliver return).

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Amendment of return by purchaser

  6       (1)      The purchaser may amend a land transaction return given by him by notice

to the Inland Revenue.

          (2)      The notice must be in such form, and contain such information, as the Inland

Revenue may require.

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          (3)      Except as otherwise provided, an amendment may not be made more than

twelve months after the filing date.

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 2 — Duty to keep and preserve records

    193

 

Correction of return by Revenue

  7       (1)      The Inland Revenue may amend a land transaction return so as to correct

obvious errors or omissions in the return (whether errors of principle,

arithmetical mistakes or otherwise).

          (2)      A correction under this paragraph is made by notice to the purchaser.

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          (3)      No such correction may be made more than nine months after—

              (a)             the day on which the return was delivered, or

              (b)             if the correction is required in consequence of an amendment under

paragraph 6, the day on which that amendment was made.

          (4)      A correction under this paragraph is of no effect if the purchaser—

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              (a)             amends the return so as to reject the correction, or

              (b)             after the end of the period within which he may amend the return,

but within three months from the date of issue of the notice of

correction, gives notice rejecting the correction.

          (5)      Notice under sub-paragraph (4)(b) must be given to the officer of the Board

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by whom notice of the correction was given.

Penalty for incorrect or uncorrected return

  8       (1)      A purchaser who—

              (a)             fraudulently or negligently delivers in respect of a chargeable

transaction a land transaction return which is incorrect, or

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              (b)             discovers that a land transaction return delivered by him in respect

of a chargeable transaction (neither fraudulently nor negligently) is

incorrect and does not remedy the error without unreasonable delay,

                   is liable to a tax-related penalty.

          (2)      The penalty is an amount not exceeding the amount of tax understated, that

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is, the difference between—

              (a)             the amount of tax chargeable in respect of the transaction, and

              (b)             the amount that would have been chargeable on the basis of the

return delivered.

Part 2

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Duty to keep and preserve records

Duty to keep and preserve records

  9       (1)      A purchaser who is required to deliver a land transaction return must—

              (a)             keep such records as may be needed to enable him to deliver a

correct and complete return, and

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              (b)             preserve those records in accordance with this paragraph.

          (2)      The records must be preserved for six years after the effective date of the

transaction and until any later date on which—

              (a)             an enquiry into the return is completed, or

              (b)             if there is no enquiry, the Inland Revenue no longer have power to

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enquire into the return.

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 3 — Enquiry into return

    194

 

          (3)      The records required to be kept and preserved under this paragraph

include—

              (a)             relevant instruments relating to the transaction, in particular, any

contract or conveyance, and any supporting maps, plans or similar

documents;

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              (b)             records of relevant payments, receipts and financial arrangements.

Preservation of information instead of original records

  10      (1)      The duty under paragraph 9 to preserve records may be satisfied by the

preservation of the information contained in them.

          (2)      Where information is so preserved a copy of any document forming part of

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the records is admissible in evidence in any proceedings before the

Commissioners to the same extent as the records themselves.

Penalty for failure to keep and preserve records

  11      (1)      A person who fails to comply with paragraph 9 in relation to a transaction is

liable to a penalty not exceeding £3,000, subject to the following exception.

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          (2)      No penalty is incurred if the Inland Revenue are satisfied that any facts that

they reasonably require to be proved, and that would have been proved by

the records, are proved by other documentary evidence provided to them.

Part 3

Enquiry into return

20

Notice of enquiry

  12      (1)      The Inland Revenue may enquire into a land transaction return if they give

notice of their intention to do so (“notice of enquiry”)—

              (a)             to the purchaser,

              (b)             before the end of the enquiry period.

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          (2)      The enquiry period is the period of nine months—

              (a)             after the filing date, if the return was delivered on or before that date;

              (b)             after the date on which the return was delivered, if the return was

delivered after the filing date;

              (c)             after the date on which the amendment was made, if the return is

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amended under paragraph 6 (amendment by purchaser).

          (3)      A return that has been the subject of one notice of enquiry may not be the

subject of another, except one given in consequence of an amendment (or

another amendment) of the return under paragraph 6.

Scope of enquiry

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  13      (1)      An enquiry extends to anything contained in the return, or required to be

contained in the return, that relates—

              (a)             to the question whether tax is chargeable in respect of the

transaction, or

              (b)             to the amount of tax so chargeable.

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                   This is subject to the following exception.

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 3 — Enquiry into return

    195

 

          (2)      If the notice of enquiry is given as a result of an amendment of the return

under paragraph 6 (amendment by purchaser)—

              (a)             at a time when it is no longer possible to give notice of enquiry under

paragraph 12, or

              (b)             after an enquiry into the return has been completed,

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                   the enquiry into the return is limited to matters to which the amendment

relates or that are affected by the amendment.

Notice to produce documents etc for purposes of enquiry

  14      (1)      If the Inland Revenue give notice of enquiry into a land transaction return,

they may by notice in writing require the purchaser—

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              (a)             to produce to them such documents in his possession or power, and

              (b)             to provide them with such information, in such form,

                   as they may reasonably require for the purposes of the enquiry.

          (2)      A notice under this paragraph (which may be given at the same time as the

notice of enquiry) must specify the time (which must not be less than 30

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days) within which the purchaser is to comply with it.

          (3)      In complying with a notice under this paragraph copies of documents may

be produced instead of originals, but—

              (a)             the copies must be photographic or other facsimiles, and

              (b)             the Inland Revenue may by notice require the original to be

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produced for inspection.

                   A notice under paragraph (b) must specify the time (which must not be less

than 30 days) within which the purchaser is to comply with it.

          (4)      The Inland Revenue may take copies of, or make extracts from, any

documents produced to them under this paragraph.

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          (5)      A notice under this paragraph does not oblige a purchaser to produce

documents or provide information relating to the conduct of—

              (a)             any pending appeal by him, or

              (b)             any pending referral to the Special Commissioners under paragraph

19 to which he is a party.

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Appeal against notice to produce documents etc

  15      (1)      An appeal may be brought against a requirement imposed by a notice under

paragraph 14 to produce documents or provide information.

          (2)      Notice of appeal must be given—

              (a)             in writing,

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              (b)             within 30 days after the issue of the notice appealed against,

              (c)             to the officer of the Board by whom that notice was given.

          (3)      An appeal under this paragraph shall be heard and determined in the same

way as an appeal against an assessment.

          (4)      On an appeal under this paragraph the Commissioners—

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              (a)             shall set aside the notice so far as it requires the production of

documents, or the provision of information, that appears to them not

reasonably required for the purposes of the enquiry, and

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 3 — Enquiry into return

    196

 

              (b)             shall confirm the notice so far as it requires the production or

documents, or the provision of information, that appears to them

reasonably required for the purposes of the enquiry.

          (5)      A notice that is confirmed by the Commissioners (or so far as it is confirmed)

has effect as if the period specified in it for complying was 30 days from the

5

determination of the appeal.

          (6)      The decision of the Commissioners on an appeal under this paragraph is

final.

Penalty for failure to produce documents etc

  16      (1)      A person who fails to comply with a notice under paragraph 14 (notice to

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produce documents etc for purposes of enquiry) is liable—

              (a)             to a penalty of £50, and

              (b)             if the failure continues after a penalty is imposed under paragraph

(a) above, to a further penalty or penalties not exceeding the amount

specified in sub-paragraph (2) below for each day on which the

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failure continues.

          (2)      The amount referred to in sub-paragraph (1)(b) is—

              (a)             £30 if the penalty is determined by an officer of the Board, and

              (b)             £150 if the penalty is determined by the court.

          (3)      No penalty shall be imposed under this paragraph in respect of a failure at

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any time after the failure has been remedied.

Amendment of self-assessment during enquiry to prevent loss of tax

  17      (1)      If at a time when an enquiry is in progress into a land transaction return the

Inland Revenue form the opinion—

              (a)             that the amount stated in the self-assessment contained in the return

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as the amount of tax payable is insufficient, and

              (b)             that unless the assessment is immediately amended there is likely to

be a loss of tax to the Crown,

                   they may by notice in writing to the purchaser amend the assessment to

make good the deficiency.

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          (2)      In the case of an enquiry that under paragraph 13(2) is limited to matters

arising from an amendment of the return, sub-paragraph (1) above applies

only so far as the deficiency is attributable to the amendment.

          (3)      For the purposes of this paragraph the period during which an enquiry is in

progress is the whole of the period—

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              (a)             beginning with the day on which notice of enquiry is given, and

              (b)             ending with the day on which the enquiry is completed.

Amendment of return by taxpayer during enquiry

  18      (1)      This paragraph applies if a return is amended under paragraph 6

(amendment by purchaser) at a time when an enquiry is in progress into the

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return.

          (2)      The amendment does not restrict the scope of the enquiry but may be taken

into account (together with any matters arising) in the enquiry.

 

 

Finance Bill
Schedule 10 — Stamp duty land tax: returns, enquiries, assessments and appeals
Part 3 — Enquiry into return

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          (3)      So far as the amendment affects the amount stated in the self-assessment

included in the return as the amount of tax payable, it does not take effect

while the enquiry is in progress and—

              (a)             if the Inland Revenue state in the closure notice that they have taken

the amendments into account and that—

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                    (i)                   the amendment has been taken into account in formulating

the amendments contained in the notice, or

                    (ii)                  their conclusion is that the amendment is incorrect,

                              the amendment shall not take effect;

              (b)             otherwise, the amendment takes effect when the closure notice is

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issued.

          (4)      For the purposes of this paragraph the period during which an enquiry is in

progress is the whole of the period—

              (a)             beginning with the day on which notice of enquiry is given, and

              (b)             ending with the day on which the enquiry is completed.

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Referral of questions to Special Commissioners during enquiry

  19      (1)      At any time when an enquiry is in progress into a land transaction return

any question arising in connection with the subject-matter of the enquiry

may be referred to the Special Commissioners for their determination.

          (2)      Notice of referral must be given—

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              (a)             jointly by the purchaser and the Inland Revenue,

              (b)             in writing,

              (c)             to the Special Commissioners.

          (3)      The notice of referral must specify the question or questions being referred.

          (4)      More than one notice of referral may be given under this paragraph in

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relation to an enquiry.

          (5)      For the purposes of this paragraph the period during which an enquiry is in

progress is the whole of the period—

              (a)             beginning with the day on which the notice of enquiry was given,

and

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              (b)             ending with the day on which the enquiry is completed.

Withdrawal of notice of referral

  20      (1)      The Inland Revenue or the purchaser may withdraw a notice of referral

under paragraph 19 by notice in accordance with this paragraph.

          (2)      Notice of withdrawal must be given—

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              (a)             in writing,

              (b)             to the other party to the referral and to the Special Commissioners,

              (c)             before the first hearing by the Special Commissioners in relation to

the referral.

Effect of referral on enquiry

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  21      (1)      While proceedings on a referral under paragraph 19 are in progress in

relation to an enquiry—

              (a)             no closure notice shall be given in relation to the enquiry, and

 

 

 
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