Citation and commencement

1. These Regulations may be cited as the Penalties for Enablers of Defeated Tax Avoidance (Legally Privileged Communications Declarations) Regulations 2017 and come into force on 2nd January 2018.

Interpretation

2. In these Regulations a reference to a numbered paragraph is a reference to the paragraph in Schedule 16 to the Finance Act (No. 2) 2017 which is so numbered.

The declaration

3. A declaration under paragraph 44 must satisfy Conditions A, B and C.

Condition A

4. Condition A is that the declaration must contain sufficient information as might reasonably be expected to enable HMRC to identify—

(a) the person who would rely on the declaration for the purpose of establishing that that person is not liable to a penalty under paragraph 1;

(b) the relevant lawyer making the declaration;

(c) the relevant lawyers whose legally privileged communications would otherwise be relied upon to establish that the person referred to in paragraph (a) is not a person who enabled the arrangements for the purposes of paragraph 1; and

(d) the arrangements (and, where appropriate, the proposal which was implemented by the arrangements) to which the declaration relates.

Condition B

5. Condition B is that the declaration must contain the confirmations set out in regulations 6 to 10 which must be made by the relevant lawyer making the declaration.

Designer of arrangements (paragraph 8)

6. In relation to whether the person referred to in regulation 4(a) is a designer of arrangements falling within paragraph 8, the confirmation is that the person—

(a) was not, in the course of a business carried on by that person, responsible to any extent for the design of the arrangements or a proposal which was implemented by the arrangements; or

(b) was responsible to an extent for such design because of having provided advice but—

(i) the advice provided is not relevant advice within the meaning of paragraph 8(3); or

(ii) the knowledge condition in paragraph 8(4) is not met.

Managers of arrangements (paragraph 9)

7. —(1) In relation to whether the person referred to in regulation 4(a) is a manager of the arrangements falling within paragraph 9(1), the confirmation is that—

(a) the person was not, in the course of a business carried on by that person, to any extent responsible for the organisation or management of the arrangements; or

(b) if the person was so responsible for the organisation or management of the arrangements, the condition set out in paragraph 9(1)(b) is not met.

(2) Where the person referred to in regulation 4(a) is not a manager of the arrangements because of paragraph 9(2), the confirmation is that the person referred to in regulation 4(a) meets the condition set out in paragraph 9(2)(b).

Marketers of arrangements (paragraph 10)

8. In relation to whether the person referred to in regulation 4(a) marketed arrangements to T so as to fall within paragraph 10, the confirmation is that the person did not in the course of a business carried on by that person—

(a) make available for implementation by T a proposal which has since been implemented, in relation to T, by the arrangements; or

(b) communicate information to T or another person about a proposal which has since been implemented, in relation to T, by the arrangements with a view to T entering into the arrangements or transactions forming part of the arrangements.

Enabling participants (paragraph 11)

9. In relation to whether the person referred to in regulation 4(a) is an enabling participant falling within paragraph 11, the confirmation is that—

(a) the person is not a person (other than T) who entered into the arrangements or a transaction forming part of the arrangements; or

(b) if the person did enter into the arrangements or a transaction forming part of the arrangements, the condition set out in paragraph 11(c) is not met.

Financial enablers (paragraph 12)

10. In relation to whether the person referred to in regulation 4(a) is a financial enabler falling within paragraph 12, the confirmation is that—

(a) the person did not in the course of a business carried on by that person, provide a financial product (directly or indirectly) to a relevant party within the meaning of paragraph 12; or

(b) to the extent that the person did provide a financial product, the condition set out in paragraph 12(1)(c) is not met.

Condition C

11. Condition C is that the declaration must contain—

(a) a certificate that the information provided by the relevant lawyer making the declaration is correct to the best of their knowledge and belief; and

(b) a statement that the relevant lawyer making the declaration understands that any of the persons referred to in regulation 4 may have to pay financial penalties as set out in paragraphs 1 and 45 and that any relevant lawyer named in the declaration may face prosecution for providing false information should that declaration prove to be incorrect.

Multiple implementations of a proposal

12. Where a proposal for arrangements was implemented more than once by arrangements which are substantially similar, the declaration may contain a statement that this is the case and that the involvement of the person referred to in regulation 4(a) in relation to those arrangements was such that all the things stated in the declaration are equally true in relation to those arrangements.