IEIM740110 - Meaning of Evidence

Regulation 9 requires an intermediary or reportable taxpayer who reports a reportable arrangement to notify other persons where they know or should be reasonably expected to know that these other persons are either intermediaries or the reportable taxpayer. Receiving this notification should be sufficient evidence that a report has been made.

Where intermediaries have worked on the same reportable arrangement, they will need to coordinate with each other about who should report. The promoter will have full details of the arrangement and the other service providers. In the first instance the intermediary that has the earlier reporting requirement should report and notify other that the report has been made. For example, if a service provider who knows that they have provided assistance in a reportable arrangement has not received a notification then they should discuss this with the promoter. With these notifications and discussions all intermediaries involved in a reportable arrangement should be aware of their reporting requirements.

Once the reporting requirement has been established then the parties can have discussions to agree who is required to report. Once it is decided who should report, and assuming that this person will notify other intermediaries and reportable taxpayers that a report has been made, then there is likely to be sufficient evidence to support the decision of those intermediaries not to report.

There is no requirement for an intermediary to review the report made by another intermediary to confirm that all the reportable information that they hold has indeed been reported.

Where an intermediary who is a promoter, and therefore will know the full details of the arrangement (see IEIM721030), makes a report to HMRC (or the tax authorities in another partner jurisdiction), other intermediaries can rely on the promoter to have provided all the reportable information. Therefore, when the promoter agrees with the other intermediaries that it is responsible for reporting there is no need for other intermediaries to check that the reportable information they hold was included in the report; they can assume that it was included unless they have particular reason to believe otherwise. Only if they know that certain information which should have been reported was in fact not reported should they make an additional report. This could be the case if the other intermediary who is not the promoter provided advice directly to a reportable taxpayer, which the promoter would not have been aware of, or if the intermediary was responsible for marketing the arrangement to clients, so that the promoter did not know the identities of the reportable taxpayers

An intermediary cannot automatically assume that a report made by a service provider will be complete and correct. For example, an accountant may provide advice in relation to one aspect of the arrangement only. They might be aware that the arrangement is reportable, but not know the full details of how the arrangement works. If they make a report and notify the promoter, the promoter cannot rely simply on the fact that a report has been made, as they cannot assume that the service provider will know all the reportable information they hold. In such a case, a further report is likely to be necessary, unless the intermediary can assure themselves that the information reported by the service provider was in fact complete.

In some circumstances, it may not be entirely clear whether an intermediary is a promoter or a service provider. When the two intermediaries discuss the reporting requirement, they should consider, given their knowledge of the arrangement as a whole and the intermediaries’ roles within the arrangement, and conclude who, if anyone, is the promoter and who if anyone, is the service provider.

Where one intermediary assesses that an arrangement is not reportable, another intermediary may be able to rely on that assessment, rather than making its own assessment. However, in order to be able to rely on that assessment, it must satisfy itself that the conclusion reached is a reasonable one, based on its knowledge of the arrangement. It must also be satisfied that the intermediary that made the assessment was suitably qualified to reach the conclusion, and that it had the necessary information and knowledge of the arrangement to reach that conclusion. If the second intermediary has information or knowledge which appears to contradict the first intermediary’s conclusion, the second intermediary should make its own assessment of the arrangement.