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Business Income Manual

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Specific deductions: crime (expenditure involving): criminal payments: Bribery Act

Under the Bribery Act 2010 it is an offence to offer, give, or accept bribes in the UK or overseas. The Act has replaced a number of older Acts dealing with the prevention of corruption, as well as the common law offence of bribery. The Act targets a wide range of situations, so that it is an offence for a person:

  1. to offer, promise or give a financial or other advantage to another which is intended to bring about an improper performance of a specified function or activity by another person or to reward such improper performance;
  2. to offer, promise or give a financial or other advantage to another if the person knows or believes that the acceptance of the advantage in itself would constitute the improper performance of a function or activity;
  3. to request, agree to receive or accept a financial or other advantage intending that, in consequence, a function or activity should be performed improperly, whether by the person himself or by another person;
  4. to request, agree to receive or accept a financial or other advantage, and the request, agreement or acceptance itself constitutes the improper performance of a function or activity by the person;
  5. to request, agree to receive or accept a financial or other advantage as a reward for the improper performance, whether by the person himself or by another person, of a function or activity;
  6. in anticipation of or in consequence of requesting, agreeing to receive or accepting a financial or other advantage, to:
(i) perform a function or activity improperly; or

(ii) request, assent to or acquiesce in, the improper performance of a function or activity by another person,;
  1. to bribe a foreign public official if the person intends to influence the official in the performance of his functions as a public official and intends to obtain or retain business or a business advantage.

The Act also introduced an offence of failing to prevent bribery which can only be committed by a company or partnership. Such an offence is committed where a person who is associated with the organisation bribes another person with the intention of obtaining or retaining business or an advantage in the conduct of business for the organisation.

The functions and activities specified in (a) to (f) above are functions of a public nature and activities connected with a business, activities performed in the course of employment and any activities performed by or on behalf of a body of persons (whether or not incorporated). The person performing the function or activity must be expected to perform it in good faith or impartially or must be in a position of trust as a result of performing it. The functions or activities may be performed outside the UK.

Payments which constitute an offence under the Bribery Act are disallowable as criminal payments.

Territorial scope

An offence under (a)-(f) above or an offence of failing to prevent bribery is committed if either (i) any act or omission to which the offence relates takes place in the UK, or (ii) the acts or omissions take place abroad but would form part of an offence if they had taken place in the UK and are performed by a person with a ‘close connection’ with the UK. For the purposes of the Bribery Act, a person has a close connection with the UK if they are (broadly) a British national, ordinarily resident, or a body incorporated in the UK.

For the purpose of the offence in (g) above it is immaterial where the conduct element of the offence occurs.

Where an offence is outside the territorial scope of the Act, payments which would constitute an offence if paid in the UK are disallowable as criminal payments.