CH124650 - Offshore matters: penalties for enablers of offshore tax evasion or non-compliance: calculating the penalty: determining quality of disclosure for penalty reductions

Whether a disclosure was prompted or unprompted will determine the minimum level of the penalty, see CH124640.

When calculating the penalty HMRC officers must also take into account the quality of the enabler’s disclosure. This will include considerations of the timing, nature and extent of the disclosure.

Where relevant, the quality of disclosure or assistance provided by an enabler will need to take account of their

  • co-operation concerning the person that has committed the evasion or non-compliance. This is the person who meets Condition B, see CH124400, and
  • disclosure about their own enabling of the evasion or non-compliance.

An enabler’s disclosure in relation to the person who has committed the evasion or non-compliance

An enabler assists HMRC if they help an officer carry out a compliance check on a person charged with a relevant offence or liable to a relevant penalty. This assistance can take the form of, but is not limited to,

  • encouraging cooperation between that person and HMRC,
  • allowing access to records,
  • establishing and quantifying that person’s liability to the penalty.

The greater the extent to which a person tells, helps and gives access to HMRC, the more the penalty can be reduced for disclosure. This is the quality of disclosure.

To calculate the reduction for disclosure HMRC must consider the three elements of disclosure, see CH403203. These are

  • telling HMRC about it,
  • giving HMRC reasonable help, and
  • allowing HMRC access to records.

The disclosure reduction for each element is assessed on the timing, nature and extent of the disclosure.

An enabler’s disclosure in relation to their own behaviour

An enabler assists HMRC if they help an officer to establish whether they themselves are liable to the penalty as an enabler of offshore tax evasion or non-compliance. This assistance can take the form of, but is not limited to

  • allowing access to records,
  • assisting HMRC in establishing and quantifying their liability to the penalty, or
  • cooperating with HMRC in our enquiries.

The greater the extent to which an enabler tells, helps and gives access to HMRC, the more the penalty can be reduced for disclosure. This is the quality of disclosure.

To calculate the reduction for disclosure HMRC must consider the three elements of disclosure, see CH403203. These are

  • telling HMRC about it,
  • giving HMRC reasonable help, and
  • allowing HMRC access to records.

The disclosure reduction for each element is assessed on the timing, nature and extent of the disclosure.

For further guidance, see CH401283.

See CH124900 for further guidance on the use of Schedule 36 information powers and offshore enabler sanctions.