Policy paper

Anti‑avoidance information notices — technical information

Published 9 September 2026

1. Anti‑avoidance information notices (AAINs)

1.1 Purpose and scope

This guidance explains the new anti‑avoidance information notice powers to obtain information and documents from persons HMRC reasonably suspects are connected with the promotion or facilitation of tax avoidance. Where appropriate, it also explains how the powers may interact with existing schedule 36 FA 2008 information powers.

The AAIN power does not replace provisions for taxpayer, third‑party, financial institution, identification and identity unknown notices under schedule 36, which continues to govern investigations into taxpayers’ tax positions. The AAIN provisions govern investigations into activities related to promotion of tax avoidance.

AAINs are an information‑gathering tool only. They are not dependent on:

• proof of tax loss
• a finding that arrangements are ineffective

The threshold is whether the information is reasonably required for the statutory purposes.

2. Anti‑avoidance enactments

2.1 What counts as an anti‑avoidance enactment or taking action under an anti‑avoidance enactment

Section 178 (1) specifies that the following enactments are anti-avoidance enactments for the purposes of chapter 3:

• part 7 of Finance Act 2004 — disclosure of tax avoidance schemes (DOTAS), requires certain arrangements to be disclosed to HMRC
• part 5 of Finance Act 2014 — promoters of tax avoidance schemes (POTAS), sets rules and sanctions for promoters who market avoidance schemes
• schedule 16 to Finance (No.2) Act 2017 — penalties for enablers of defeated tax avoidance, applies penalties to people who have enabled certain failed avoidance schemes (for example designers, marketers, and other types of enabler)
• schedule 17 to Finance (No.2) Act 2017 — disclosure of tax avoidance schemes: VAT and other indirect taxes (DASVOIT), requires disclosure of certain arrangements for VAT and other indirect taxes
• chapter 1 of part 6 [Finance Act 2026] — Prohibition on promotion of certain tax‑avoidance arrangements, creates a prohibition on promoting avoidance arrangements

Section 178(2) provides that a reference to taking action under an anti-avoidance enactment also includes a reference to taking action under the following additional enactments:

• Company Directors Disqualification Act 1986, sections 8ZF and 8ZG — disqualification for promoting tax avoidance, allows disqualification of directors who promote tax-avoidance schemes
• Finance Act 2020, schedule 13 — joint and several liability, allows for certain individuals found to be enablers or promoters of avoidance to be jointly and severally liable for tax and penalties connected to avoidance arrangements
• Finance Act 2022, section 85 — HMRC winding‑up petitions, enables HMRC to petition to wind up companies involved in the promotion of tax avoidance
• Finance Act 2022, section 86 — publication of information about tax‑avoidance schemes, allows HMRC to publish information about tax avoidance schemes and those involved in their promotion
• Finance Act 2022, sections 87 to 89 — freezing orders etc, empowers HMRC to seek freezing orders when intending to pursue certain penalties related to the promotion of avoidance arrangements through the tribunal
• Finance Act 2022, schedule 13 — penalties for facilitating avoidance schemes involving non‑resident promoters, empowers HMRC to assess additional penalties on UK persons who have incurred penalties by reference to the promotion of avoidance schemes where the promotion structure includes a non-resident promoter
• chapter 2 of part 6 — promoter action notices, allows HMRC in specified circumstances to certify a person as a promoter and issue notices requiring the recipient to stop providing goods or services to the certified promoter.

AAINs can be used at any stage of HMRC’s engagement, from initial consideration of a person’s activities through to post‑action monitoring.

3. Meaning of ‘connected person’

3.1 Who a connected person is

A connected person is someone HMRC reasonably suspects is, or has been:

• contravening an anti‑avoidance enactment
• connected to a person who is or has been contravening an anti‑avoidance enactment
• connected to arrangements that led to the contravention

Connection is interpreted widely and includes:

• connections between a company and its directors, managers, secretaries, officers or employees
• connections between a partnership and its members or partners
• connections between two persons involved in the same trust, whether as trustee, settlor, beneficiary or administrator
• connections between two persons where one is accustomed to act on the other’s instructions
• connections between a person and arrangements where, to any extent, the person:
  • is involved in making the arrangements available
  • is involved in organising or managing the arrangements
  • benefits directly or indirectly from the arrangements

The courts have explained that ‘to suspect’ something is to think there is a possibility, more than merely imaginable or fanciful, that certain facts are true (R v Da Silva [2006] EWCA Crim 1654).

4. Types of anti-avoidance information notices

AAINs fall into five statutory categories:

• connected person notices (section 179)
• third‑party notices (section 180)
• unidentified connected person notices (section 181)
• identification notices (section 182)
• financial institution notices (section 183)

4.1 Connected person notices (section 179)

4.1.1 When a connected person notice can be used

An officer of HMRC may issue a notice in relation to a connected person requiring information that is reasonably required for:

• monitoring that person’s compliance with an anti‑avoidance enactment
• HMRC taking, or considering whether HMRC could take, action against the connected person under an anti‑avoidance enactment

4.1.2 Tribunal approval

The HMRC officer intending to issue a connected person notice has the option to seek tribunal approval before issuing the notice. They may do this where, for example:

• the notice is likely to be challenged
• the intended scope of the notice is extensive or novel

4.2 Third‑party notices (Section 180)

4.2.1 When a third‑party notice can be used

HMRC may use a third‑party notice to obtain, from a third-party, information about a connected person who is the subject of HMRC’s investigations. Such a notice must identify the connected person to whom it relates.

4.2.2 Procedural steps (mandatory)

Before issuing the notice, an officer of HMRC must follow the steps below.

1. Notify the intended recipient of the intention to issue the notice and the information that would be required.

2. Allow a reasonable opportunity for the intended recipient to make representations.

3. Obtain either the agreement of the connected person, or tribunal approval.

When issuing the notice, HMRC must provide the connected person with both:

• a copy of the notice
• a summary of reasons for requiring the information

A number of the procedural requirements can be disapplied if the tribunal agrees that complying with them would prejudice the investigation. This includes the requirement that the notice should identify the connected person to whom it relates, as well as the steps set out at 1 and 2 above, and the requirement to give the connected person a copy of the notice and reasons for requiring the information. 

The tribunal may not approve a notice unless it has been given a summary of any representations made.

4.3 Notices for unidentified connected persons (section 181)

4.3.1 When these can be used

An officer of HMRC may issue a notice where the information is reasonably required for either:

• monitoring compliance of an unidentified connected person with an anti‑avoidance enactment
• taking, or considering whether HMRC could take action against an unidentified connected person under an anti‑avoidance enactment

‘An unidentified connected person’ includes:

• a connected person whose identity is not known
• a class of persons whose individual identities are not known to HMRC, but of which at least one member is a connected person

4.3.2 Key restrictions

The key restrictions are that:

• tribunal approval is mandatory
• the notice may only require information not readily available from another source

4.4 Identification notices (section 182)

4.4.1 Purpose

Identification notices are limited to requiring identifying information (name, address, date of birth) that is not readily available from another source and is required to identify an unidentified connected person.

4.4.2 Preconditions

To issue an identification notice, an officer of HMRC must have reason to believe that both:

• the recipient could identify the connected person using information provided by HMRC
• the relevant information was obtained in the course of a business

4.4.3 Approval

An authorised officer of HMRC may seek the tribunal’s approval before issuing an identification notice.

An officer of HMRC may not issue an identification notice without the approval of either:

• an authorised officer
• the tribunal

4.5 Financial institution notices (FINs)(Section 183)

4.5.1 What counts as a ‘financial institution’

Financial institution covers:

• bodies that are financial institutions under the Common Reporting Standard (CRS), except certain investment‑only entities
• credit card issuers

The Common Reporting Standard (CRS) is an international standard that broadly applies to banks, building societies, investment platforms, and credit card providers.

4.5.2 When these are used

An officer of HMRC may issue a FIN to require information that is, in the officer’s opinion, reasonably required for either:

• monitoring a connected person’s compliance with an anti‑avoidance enactment
• HMRC taking, or considering whether HMRC could take, action against a connected person under an anti‑avoidance enactment

A FIN must identify the connected person to whom it relates.

4.5.3 Approval

A FIN cannot be issued without the approval of the tribunal.

4.5.4 Post‑issue obligations

After issuing a FIN, HMRC must provide the connected person in question with both:

• a copy of the notice
• a summary of the reasons for requesting the information

However, the tribunal may disapply these requirements if complying with them would prejudice the investigation of tax avoidance by tipping off individuals who may destroy evidence, or otherwise obstruct HMRC activity.

5. Content of anti-avoidance information notices

Every AAIN must specify or, as applicable, describe:

• the information required
• the form and means of provision
• a reasonable compliance period
• the statutory provision relied upon to issue the notice
• whether the notice was issued with the approval of the tribunal

5.1 Requirements

The requirements are that:

• third-party notices, unidentified connected persons notices, identification notices, and FINs may only require information that the issuing officer considers would not be unduly onerous for the recipient to provide
• documents older than 6 years may only be required with the agreement of an authorised officer of HMRC
• notices may be issued to persons outside the UK

6. Excepted information

6.1 Possession or power

An information notice does not require a person to provide information that is not in their possession or power.

6.2 Categories of information that are excepted

An AAIN does not require the provision of:

• information relating to the conduct of a pending tax appeal or appeal against a decision under an anti‑avoidance enactment
• personal records, as defined in section 12 of the Police and Criminal Evidence Act 1984 (PACE), or information contained in such records — however, a notice may require a redacted version of a document where the redaction removes material that would otherwise make it a personal record
• journalistic material, as defined in section 13 of PACE, or information contained in such material
• information in respect of which a claim to legal professional privilege (LPP) or, (in Scotland) to confidentiality of communications as between a client and their legal adviser, could be maintained by the notice recipient in legal proceedings

6.3 Information held by auditors

An AAIN does not require an auditor to provide information held or created in the course of performing statutory audit functions, except information that the auditor has assisted a client in preparing for or sending to HMRC.

6.4 Limits to the auditor protection 

The auditor exception does not apply in relation to either:

• a notice issued under section 182 (identification notices)
• identifying information required under section 181 (unidentified connected persons) where HMRC is seeking information about either:
  • the connected person to whom the notice relates
  • a person who has acted on behalf of that connected person

6.5 Disputes regarding legal privilege

The Commissioners may make regulations to allow the tribunal to resolve disputes about whether information is legally privileged. For more information, read The Anti-avoidance Information Notices (Resolution of Disputes as to Privilege) Regulations 2026.

6.6 What HMRC can require

HMRC may require information or documents reasonably required for the stated AAIN purpose. In practice, the range of information HMRC might require includes:

• marketing materials, step plans, implementation manuals, client onboarding files, fee structures, payment flows, introducer agreements, IT system exports, and communications evidencing control or benefit
• records evidencing scheme supply chains (for example, banks, card issuers, hosting, telephony, ad networks) to support potential promoter action notices

7. Restriction on disclosure of notices

7.1 When this applies

An information notice may include a requirement preventing the recipient from disclosing that the notice exists or revealing what it contains.

7.2 Who the restriction can apply to

The restriction may prohibit disclosure by the recipient to:

• the connected person to whom the notice relates
• in the case of a section 181 notice (information notices to unidentified connected persons), members of the class of persons covered by that notice
• anyone who might reasonably be expected to disclose the existence or contents of a notice to the connected person or class to which it relates
• any other person

7.3 Permitted disclosure

The restriction cannot prevent disclosure for, or in connection with, the purpose of:

• complying with the notice
• seeking legal advice

7.4 Duration of the restriction

A non‑disclosure requirement:

• applies for 12 months from the date the notice is issued, unless it is withdrawn earlier or extended
• may be withdrawn at any time by HMRC in writing
• may be extended by HMRC for one or more further 12‑month periods

7.5 Conditions for extending a restriction

A restriction can only be extended if both:

• an officer of HMRC considers that not extending it could prejudice the investigation of tax avoidance
• the officer is not an authorised officer, an authorised officer agrees with both the decision to extend and the assessment of risk to the investigation

8. Tribunal approval of notices

8.1 When tribunal approval may be sought

HMRC may apply to the tribunal for approval to issue an AAIN, or for approval to disapply certain procedural requirements.

An application can be made without notifying the person concerned.

8.2 Authorisation required before seeking approval

An officer of HMRC, who is not an authorised officer, may only seek tribunal approval to issue a notice, or agreement to disapply requirements, with the agreement of an authorised officer of HMRC.

8.3 What the tribunal must be satisfied of

The tribunal may not approve the issue of an AAIN, or the disapplication of certain requirements, unless it is satisfied that the relevant statutory conditions have been met.

8.4 Finality of tribunal decisions

A decision of the tribunal on an application for approval of a notice or disapplication of requirements is final, despite the general rights of appeal provided by sections 11 and 13 of the Tribunals, Courts and Enforcement Act 2007.

9. Withdrawal of notices

An officer of HMRC may withdraw an information notice by notifying the recipient in writing, for example when we find an error with the notice.

10. Criminal offences

10.1 Failing to comply with a notice

A recipient of an AAIN commits an offence if they fail to comply with the notice or, in purporting to comply, carelessly or deliberately provide inaccurate information.

For the purposes of this offence, ‘carelessness’ means a failure to take reasonable care.

There is a defence where the recipient can demonstrate that they had a reasonable excuse (unless inaccurate information was provided, carelessly or deliberately). For guidance about reasonable excuse, read 12.2 Sanctions: general provisions — reasonable excuse.

This section does not apply to FINs under section 183.

10.2 Concealing information

Under section 190(1), a person commits an offence if they are required to provide information under an AAIN and they conceal, destroy or otherwise dispose of relevant information before they have provided it in accordance with the notice, or do so after providing the information in circumstances where an officer of HMRC has notified them in writing that the information must continue to be available.

10.2.1 Offence following advance notification

Under section 190(4), an offence is committed where an officer of HMRC has notified a person under section 180(3) that they intend to issue a third party information notice, requiring the person to provide certain information, and the person then conceals, destroys or otherwise disposes of that information.

It is a defence for a person to show that the information was only concealed, destroyed or otherwise disposed of either:

• after six months had passed since the last notification under section 180(3)
• after an AAIN has been issued to the person in respect of that information (in which case they will be liable for the section 190(1) offence of concealing information required under an AAIN)

10.2.2 Meaning of concealing, destroying or disposing

For the purposes of section 190, concealing, destroying or disposing of information includes arranging for someone else to do so.

10.2.3 Notices to which the section 190 offences do not apply

This offence does not apply in relation to FINs issued under section 183.

10.3 Criminal Liability of Responsible Persons

Section 191 applies where an offence under section 189 (failure to comply with a notice) or section 190 (concealing information) is committed by a body corporate or a partnership. If certain conditions are met, individuals in positions of responsibility within that organisation may also be criminally liable.

10.3.1 Who may be held liable

A responsible person may be personally liable for the offence if the offence was:

• committed with their consent or connivance
• attributable to their neglect

The terms consent, connivance and neglect are not defined in the Finance Act 2026. Generally, something done with the consent or connivance of someone normally means something done with their agreement or permission.

A ‘responsible person’ includes:

• for companies:

  • directors, managers, secretaries or similar officers, or anyone acting in such a role
  • shadow directors (within the meaning of section 251 the Companies Act 2006)
• for limited liability partnerships (LLPs) or other bodies managed by members, members exercising management functions, or shadow members
• for partnerships, partners or anyone acting as a partner

10.3.2 Definition of manager and shadow member

It will be a question of fact whether a person is ‘a manager’ for the purposes of the legislation, and will not just depend on their job title. In this context, ‘manager’ can be understood as referring to a person exercising management functions.

A ‘shadow member’ is a person whose instructions or directions the members of an LLP customarily follow.

The roles should therefore be clearly defined for both managers (in case of companies) and shadow members (in case of LLPs).

A person is not a shadow member merely because members act on that person’s professional advice.

10.4 Criminal liability of responsible persons: no prosecution of recipient

Section 192 applies where the recipient of an information notice is a body corporate or a partnership, and the organisation fails to comply with the notice, or carelessly or deliberately provides inaccurate information when attempting to comply.

10.4.1 Liability of responsible persons

Where the organisation commits one of the above failures, a responsible person within the organisation may commit an offence if the failure:

• occurred with their consent or connivance
• is attributable to their neglect

This makes sure that accountability can extend to individuals who had managerial responsibility for the conduct leading to the failure, even where the recipient is not prosecuted.

10.4.2 Reasonable excuse

A responsible person has a defence if they can show that either they or the organisation had a reasonable excuse for the failure.

10.4.3 Definitions

For the purposes of this section ‘carelessness’ means a failure to take reasonable care.

The term ‘responsible person’ has the same meaning as in section 191.

10.4.4 Notices to which this section does not apply

Section 192 does not apply in respect of FINs issued under section 183 (financial institutions).

10.5 Imprisonment or a fine

Section 193 sets out the criminal penalties that may be imposed where a person is convicted of an offence under sections 189, 190 or 192.

On summary conviction, a person is liable to a fine. In England and Wales this is an unlimited fine, while in Scotland or Northern Ireland it is a fine up to the statutory maximum.

On conviction on indictment, a person may receive a custodial sentence of up to two years, a fine, or both.

Section 193 establishes the upper limits of criminal sanctions available to the court in respect of the offences and reflects the seriousness with which failures, concealment, or deliberate obstruction of HMRC’s anti‑avoidance information powers are treated.

11. Civil penalties

11.1 Failing to comply with a notice

Section 194 sets out the civil penalties that apply where a recipient of an information notice does not comply with the requirements of that notice. A penalty arises where the person fails to comply and does so without reasonable excuse (read 12.2 Sanctions: general provisions — reasonable excuse).

For notices issued under section 183 (financial institutions), there is a fixed initial penalty for non‑compliance of £300. For all other types of information notice, the fixed initial penalty for non-compliance is £5,000.

If the failure continues after an initial penalty has been imposed, daily penalties may also apply. For FINs, this is up to £60 for each day, and for all other notices it is up to £1,000 for each day. These daily penalties apply for as long as the non‑compliance continues.

Before any penalty is imposed, whether a fixed penalty or a daily penalty, HMRC must issue a notification to the recipient explaining that a penalty is being considered. The recipient must be given 30 days from the date of that notification to make representations.

Section 194 does not apply to failures relating to a requirement not to disclose a notice (section 185).

11.2 Penalty for concealing information

Section 195(1) provides for a civil penalty where a recipient of an information notice conceals, destroys, or otherwise disposes of information that they are required to provide. A person will be liable for the penalty if they dispose of required information before providing it in compliance with a notice, or after they have provided the information if HMRC has notified them that the information must be retained.

Section 195(2) provides for a civil penalty where an officer of HMRC has notified a person under section 180(3) that they intend to issue a notice requiring certain information and the person subsequently conceals, destroys or otherwise disposes of that information. This penalty does not apply where the person concealed, destroyed or disposed of the information either:

• more than six months after HMRC last issued a section 180(3) notification in respect of it
• after an information notice has been issued in respect of the information (in which case the person may be liable for the penalty at section 195(1))

The penalty for concealing, destroying or disposing of information is £300 for FINs and £20,000 for all other types of information notice.

For the purposes of section 195, concealing, destroying or otherwise disposing of information includes arranging for someone else to do so.

11.3 Penalty for inaccurate information

Section 196(1) provides for civil penalties that apply where a recipient of an information notice provides inaccurate information. A person may be liable for a penalty where they carelessly or deliberately provide inaccurate information in purporting to comply with a notice. Penalty liability may also arise where a person provides information in purported compliance with a notice and subsequently discovers that the information is inaccurate and does not take reasonable steps to inform HMRC of the error.

For FINs the maximum penalty for each inaccuracy is £3,000. For all other information notices, the maximum penalty is £20,000 for each inaccuracy.

Before assessing a penalty, an officer of HMRC must notify the recipient that they consider a penalty to be due. The recipient then has 30 days from the date of that notification to make representations explaining why a penalty should not be imposed.

For the purposes of section 196, carelessness means a failure to take reasonable care.

11.4 Penalty for disclosing a notice

Section 197 makes provision for a civil penalty where an information notice imposes a requirement on the recipient not to disclose the existence or contents of the notice (read 7. Restrictions on disclosure of notices) and, without reasonable excuse, the recipient discloses the existence or contents of the notice in breach of the requirement.

Where the breach relates to a FIN, the penalty is £1,000. For all other information notices, the penalty is £10,000.

11.5 Penalty based on monies received

Section 198 provides for an enhanced civil penalty where a person has already been penalised for failing to comply with an information notice and continues not to comply without reasonable excuse (read 12.2 Sanctions: general provisions — reasonable excuse). For the section to apply an officer of HMRC must have reason to believe that the person has received money or money’s worth in connection with the tax‑avoidance arrangements to which the information notice relates and that the continuing failure is significant. The Upper Tribunal must also decide that it is appropriate to impose an enhanced penalty.

A continuing failure will be a significant one either if it persists for more than six months after the original penalty was imposed, or if it is likely to make it significantly more difficult for HMRC to monitor a connected person’s compliance with an anti‑avoidance enactment or to take, or consider whether it could take, action against a connected person under an anti-avoidance enactment.

Where these conditions are met, the person in question is liable to a penalty equal to the amount of money or money’s worth they received (or are likely to have received) in connection with the arrangements to which the notice in question relates.

11.5.1 Application deadline where the underlying information notice is appealable

If the information notice is one that the recipient may appeal under section 204, HMRC must apply to the Upper Tribunal within 12 months of the latest of the following three dates:

• the date on which the person became liable to a penalty under section 194(1) for failing to comply with the notice
• the final day on which an appeal against the information notice could have been made
• if an appeal has been made, the date on which that appeal is determined or withdrawn

This approach makes sure that HMRC does not apply to the tribunal while an appeal in relation to liability under section 194(1) is still open or unresolved.

11.5.2 Application deadline where the notice is not appealable

If the underlying information notice is one that cannot be appealed, the 12‑month period begins on the day the person became liable to a penalty under section 194(1).

HMRC must notify the person concerned when making an application to the Upper Tribunal.

Section 198 does not apply in relation to FINs.

11.6 Increased daily default penalty

Where a person continues to fail to comply with an information notice after a daily penalty has been imposed under section 194(3), HMRC may apply to the tribunal for a determination that an increased daily penalty is payable.

An application for an increased daily penalty may be made where:

• a daily penalty has been imposed under section 194(3) for the failure to comply
• the failure continues for more than 30 days after HMRC notified the person of that daily penalty
• HMRC has informed the person that it intends to apply to the tribunal for an increased penalty

If the tribunal decides that an increased penalty should be applicable, it must determine both the amount of the increased daily penalty and the date from which it is applicable. The increased amount then replaces the standard daily rate set out in section 194(4) from the applicable date.

The tribunal may set an increased daily penalty in amount of up to £1,000 each day for FINs and up to £5,000 for each day for all other notices. In determining the amount of the penalty, the tribunal must take into account the likely cost to the person of complying with the notice, as well as any benefits gained by the person or others from the continued non‑compliance.

If the tribunal determines that an increased daily penalty is payable, HMRC must notify the person of both the amount of the increased penalty and the date from which it applies. This makes sure the individual is aware of the revised obligations and the consequences of ongoing failure.

12. Sanctions: general provisions

12.1 Extension of time periods

HMRC or the tribunal may allow extra time for a person to meet deadlines related to the civil or criminal sanctions under sections 189 to 199. A failure to meet a deadline is disregarded if the person completes the required action within the additional time allowed.

12.2 Reasonable excuse

There is a ‘reasonable excuse’ defence available in relation to the following provisions:

• section 189(1)(a) — offence of failing to comply with a notice
• section 192 — criminal liability of responsible persons: no prosecution of recipient
• section 194 — penalty for failing to comply with a notice
• section 197 — penalty for disclosing a notice
• section 198 — penalty based on monies received

Section 201 provides that:

• an insufficiency of funds is not a reasonable excuse, unless the shortage was caused by events outside the person’s control
• if the person relies on any other person to do anything, that is not a reasonable excuse unless the first person took reasonable care to avoid the failure
• if the person had a reasonable excuse for the failure but the excuse has ceased, the person is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased
• reliance on legal advice does not count as a reasonable excuse if the advice was based on incomplete or inaccurate facts, or the conclusions in the advice itself were unreasonable

The Upper Tribunal’s comments in the case of Christine Perrin [2018] UKUT 0156 (TCC), provide guidance on how the tribunal would approach reasonable excuse — read paragraphs 69 to 71 and 81..

For further guidance about reasonable excuse read the compliance handbook CH160200.

12.3 Double jeopardy

The double jeopardy rule at section 202 has the effect that where a person has been convicted of an offence under the AAIN legislation, they will not also be liable to penalties in respect of the same behaviour.

12.4 Application of relevant sections of schedule 36

This part of the guidance explains how certain provisions of schedule 36 to the Finance Act 2008 apply to penalties imposed under sections 194 to 198 of the anti‑avoidance information notices regime.

12.4.1 Paragraph 46 of schedule 36

Paragraph 46 of schedule 36 applies to three types of penalties:

• section 194 — penalty for failing to comply with an information notice
• section 195 — penalty for concealing information
• section 196 — penalty for providing inaccurate information

Under paragraph 46, HMRC must:

• formally assess the penalty
• notify the person of the assessment
• notify the person within the appropriate statutory timeframe

12.4.2 Section 203(3)

Section 203(3) provides that the assessment rules in paragraph 51B(2) to (3) of schedule 36 FA 2008 apply to penalties for disclosing an information notice (that is section 197). In practice, it means HMRC must assess and notify a disclosure penalty using the same process used for schedule 36 disclosure penalties.

12.4.3 Paragraph 49 of schedule 36 FA 2008

Paragraph 49 of schedule 36 FA 2008 applies to all civil penalties under section 194 to 197. It allows HMRC to enforce unpaid penalties as if they were tax, meaning:

• HMRC can collect penalties using standard enforcement powers
• the penalty becomes legally recoverable once properly assessed and notified

This makes sure enforcement of penalties is consistent with the broader tax enforcement framework.

12.4.4 Paragraph 51 of schedule 36 FA 2008

Paragraph 51 of schedule 36 FA 2008 applies to penalties under section 198 — penalty based on monies received. Paragraph 51 relates to penalties that are linked to tax‑related behaviours and allows HMRC to use enhanced enforcement procedures, including:

• treating the penalty like a tax debt
• using debt collection and recovery mechanisms normally used for unpaid tax

Because section 198 penalties can equal the full amount of money or money’s worth received in connection with avoidance arrangements, this stronger enforcement ability is necessary.

13. Appeals

13.1 Appeals against notices

Section 204 confers rights of appeal in relation to information notices issued under:

• section 179 (notices to connected persons)
• section 180 (notices to third parties)
• section 182 (identification notices)

13.1.1 What can be appealed

Section 179 notices — connected persons

The recipient may appeal against the issue of the notice itself or any requirement within the notice. There are no restrictions on the grounds of appeal in this subsection.

Section 180 notices — third parties

The recipient may appeal only on the grounds that it would be unduly onerous to comply with the notice or any of its requirements.

Section 182 notices — identification notices

The recipient may appeal only on the grounds that it would be unduly onerous to comply with the notice or its requirements, mirroring the appeal grounds for section 180.

13.1.2 Circumstances in which appeal is not available

No appeal can be made where the notice was issued with tribunal approval.

This means that the recipient cannot appeal at all, either against the notice or its individual requirements if both of the following apply:

• HMRC sought tribunal approval before issuing a section 179, 180 or 182 notice
• the tribunal approved issuing that notice

This is because the tribunal has already considered and authorised the notice’s validity and necessity.

13.1.3 How appeals are handled

Appeals follow the same process as appeals against schedule 36 information notices, including:

• time limits for submitting an appeal
• how HMRC reviews the appeal
• escalation to the tribunal if the person is not satisfied with the review outcome
• suspension of certain obligations while an appeal is active (subject to limitations)

13.1.4 Appeals against penalties

Section 205 confers rights of appeal in relation to HMRC decisions:

• that a penalty is payable under any of sections 194 to 197
• concerning the amount of a penalty imposed under any of those sections

This means appeals are available in respect of penalties imposed for:

• failing to comply with a notice (section 194)
• concealing information (section 195)
• providing inaccurate information (section 196)
• disclosing a restricted‑disclosure notice (section 197)

There is no provision that grants rights of appeal in respect of penalties imposed under section 198 (penalty based on monies received). That is because such penalties are imposed by the Upper Tribunal and standard rights of appeal from Upper Tribunal decisions apply.

For appeals made under section 205, the process in paragraph 48 of schedule 36 to FA 2008 applies. In summary, a person who wants to appeal must:

• submit the appeal in writing
• make sure that the notice of appeal reaches HMRC within 30 days of the date HMRC issued the penalty notification
• send the appeal to HMRC, not the tribunal

The person must state the grounds of appeal.

If HMRC does not resolve the appeal and it is sent on to the tribunal, then for appeals:

• against the decision that a penalty is payable, the tribunal can confirm HMRC’s decision or cancel the decision
• about the amount of the penalty, the tribunal can confirm the amount, or replace it with another amount HMRC could lawfully have set

Unlike section 204 (appeals against notices), section 205 places no restrictions on grounds of appeal. A person may argue, for example, that:

• the penalty should not have been charged at all
• the behaviour in question did not meet the statutory criteria (for example, they had a reasonable excuse (read 12. Sanctions: general provisions))
• the amount of the penalty was incorrectly calculated
• HMRC misinterpreted the facts or evidence

14. Miscellaneous and interpretation

14.1 Definition of terms

Section 206 defines certain terms used in the AAINs legislation as follows:

• ‘arrangements’ includes any agreement, scheme, arrangement or understanding of any kind whether or not legally enforceable involving one or more transactions
• ‘authorised officer of Revenue and Customs’ means an officer of Revenue and Customs who is, or is a member of a class of officers who are, authorised by the Commissioners for the purpose of this chapter
• ‘Commissioners’ means the Commissioners for His Majesty’s Revenue and Customs
• ‘document’ includes any part of a document
• ‘HMRC’ means His Majesty’s Revenue and Customs
• ‘information’ includes a document
• ‘information notice’ means a notice issued under any of sections 179 to 183
• ‘investigation of tax avoidance’ includes the exercise of a function under an anti-avoidance enactment
• ‘recipient’ in relation to a notice, means the person to whom the notice is issued
• ‘tribunal’ means the First-tier Tribunal or, where determined by or under the Tribunal Procedure Rules, the Upper Tribunal

14.2 Definition of providing information and of a document

For the purposes of the anti-avoidance information notices legislation, reference to:

• providing information includes a reference to producing documents
• a document is a reference to anything in which information of any description is recorded

 14.3 Schedule 36

The rules in paragraphs 7(2) to (4), 8, 15 and 16 of schedule 36 of the Finance Act 2008, which govern how HMRC can ask for documents and how those requests work, apply in the same way to any documents requested under this chapter.

14.3.1 Paragraph 7(2) to (4) — where and how documents must be produced

If HMRC issues an information notice asking someone to produce a document, that person must show the document at a place either:

• agreed between them and HMRC
• HMRC reasonably specifies

HMRC cannot require the person to produce the document at a place that is only used as a home.

If someone hands over a document to comply with a notice, doing so is not regarded as breaking any lien over the document (lien means a legal right to keep the document until a debt is paid).

14.3.2 Paragraph 8 — producing copies or originals

A person can normally comply with a notice by giving a copy of the document instead of the original. However, this does not apply if either:

• the notice specifically asks for the original
• HMRC later sends a written request asking for the original

If HMRC requests the original where the notice did not require it, the person must produce it both: - within a reasonable time - in the way HMRC reasonably requests

14.3.3 Paragraph 15 — HMRC can copy documents

When a person produces a document (or a copy) to HMRC, HMRC is allowed to copy it, or make extracts from it.

14.3.4 Paragraph 16 — HMRC can remove and keep documents temporarily

An HMRC officer can take a document away at a reasonable time, and keep it for a reasonable period, if they consider doing so is necessary.

The person who produced the document can ask for a receipt, and a free copy of the document if they need it.

Removing the document is not regarded as breaking any lien over it (lien means a legal right to keep the document until a debt is paid).

If HMRC loses or damages the document, they must compensate the owner for reasonable costs of repair or replacement.

‘Document’ in paragraph 16 also includes copies of documents.

14.4 TMA 1970

The following provisions of TMA 1970 apply for the purposes of the AAINs legislation as they apply for the purposes of the Taxes Acts:

• section 108 (responsibility of company officers)
• section 114 (want of form)
• section 115 (delivery and service of documents)