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Revenue Scotland and Tax Powers Act 2014

Type Act of the Scottish Parliament

Publication 2014-09-24

Last updated 2020-03-11

State In force

Jurisdiction Scotland

Department Statute Law Database

Source legislation.gov.uk

articles Not indexed

Reform history JSON API

PART 1 — Overview of Act

Overview

1

This Act is arranged as follows—

Part 2 establishes Revenue Scotland and provides for its general functions and responsibilities,

Part 3 makes provision about the use and protection of taxpayer and other information,

Part 4 establishes the Scottish Tax Tribunals,

Part 5 puts in place a general anti-avoidance rule,

Part 6 contains provisions on the self-assessment system, the checking of tax returns by Revenue Scotland and claims for repayment of tax,

Part 7 makes provision for Revenue Scotland's investigatory powers,

Part 8 sets out the matters in relation to which penalties may be imposed,

Part 9 makes provision about the interest payable on unpaid tax, on penalties and on tax repayments,

Part 10 contains provisions on debt enforcement by Revenue Scotland,

Part 11 sets out the system for the review, mediation and appeal of Revenue Scotland decisions, and

Part 12 contains general and final provisions.

PART 2 — Revenue Scotland

Establishment of Revenue Scotland

Revenue Scotland

2

(1) There is established a body corporate to be known as Revenue Scotland.

(2) In Gaelic, Revenue Scotland is to be known as Teachd-a-steach Alba.

(3) Schedule 1 makes further provision about the membership, procedures and staffing of Revenue Scotland.

Functions of Revenue Scotland

3

(1) Revenue Scotland's general function is the collection and management of the devolved taxes.

(2) Revenue Scotland has the following particular functions—

(a) providing information, advice and assistance to the Scottish Ministers relating to tax,

(b) providing information and assistance to taxpayers, their agents and other persons relating to the devolved taxes,

(d) protecting the revenue against tax fraud and tax avoidance.

(3) “Devolved taxes” has the meaning given by section 80A(4) of the Scotland Act 1998 (c.46).

Delegation of Revenue Scotland functions

Delegation of functions by Revenue Scotland

4

(1) Revenue Scotland may delegate—

(a) any of its functions relating to land and buildings transaction tax to the Keeper of the Registers of Scotland (“the Keeper”),

(b) any of its functions relating to Scottish landfill tax to the Scottish Environment Protection Agency (“SEPA”).

(2) Revenue Scotland may give directions to the Keeper or to SEPA as to how a delegated function is to be exercised and the Keeper and SEPA must comply with any such direction.

(3) Delegations or directions under this section may be varied or revoked at any time.

(4) Revenue Scotland must publish information about—

(a) delegations under this section, and

(b) directions given under this section.

(5) Revenue Scotland must lay before the Scottish Parliament a copy of information published under subsection (4).

(6) Subsections (4) and (5) do not apply to the extent that Revenue Scotland considers that publication of the information would prejudice the effective exercise of its functions.

(7) Delegation of a function under this section does not affect—

(a) Revenue Scotland's ability to exercise that function,

(b) Revenue Scotland's responsibility for that function.

(8) Revenue Scotland may reimburse the Keeper or SEPA for any expenditure incurred which is attributable to the exercise by the Keeper or SEPA of functions delegated under this section.

Money

Payments into the Scottish Consolidated Fund

5

(1) Revenue Scotland must pay money received in the exercise of its functions into the Scottish Consolidated Fund.

(2) But Revenue Scotland may do so after deduction of payments in connection with repayments, including payments of interest on—

(a) repayments, or

(b) payments treated as repayments.

Rewards

6

Revenue Scotland may pay a reward to a person in return for a service which relates to a function of Revenue Scotland.

Independence of Revenue Scotland

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(1) The Scottish Ministers must not—

(a) give directions relating to, or

(b) otherwise seek to control,

the exercise by Revenue Scotland of its functions.

(2) This section is subject to any contrary provision made by or under this Act or any other enactment.

Ministerial guidance

8

(1) The Scottish Ministers may give guidance to Revenue Scotland about the exercise of its functions.

(2) Revenue Scotland must have regard to any guidance given by Ministers.

(3) Ministers must publish any guidance given to Revenue Scotland under this section as they consider appropriate.

(4) The Scottish Ministers must lay before the Scottish Parliament a copy of guidance published under subsection (3).

(5) Subsections (3) and (4) do not apply to the extent that Ministers consider that publication of the guidance would prejudice the effective exercise by Revenue Scotland of its functions.

Provision of information, advice or assistance to Ministers

Provision of information, advice or assistance to the Scottish Ministers

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(1) Revenue Scotland must provide the Scottish Ministers with such information, advice or assistance relating to its functions as Ministers may from time to time require.

(2) The information, advice or assistance must be provided in such form as Ministers determine.

Charter of standards and values

10

(1) Revenue Scotland must prepare a Charter.

(2) The Charter must include—

(a) standards of behaviour and values which Revenue Scotland is expected to adhere to when dealing with taxpayers, their agents and other persons in the exercise of its functions, and

(b) standards of behaviour and values which Revenue Scotland expects taxpayers, their agents and other persons to adhere to when dealing with Revenue Scotland.

(3) Revenue Scotland must—

(a) publish the Charter as it considers appropriate,

(b) review the Charter from time to time, and

(4) Before publishing or revising the Charter, Revenue Scotland must consult such persons as it considers appropriate.

(5) Revenue Scotland must lay the first Charter and any revised Charter before the Scottish Parliament.

Corporate plan

11

(1) Revenue Scotland must, before the beginning of each planning period, prepare a corporate plan and submit it for approval by the Scottish Ministers.

(2) The corporate plan must set out—

(a) Revenue Scotland's main objectives for the planning period,

(b) the outcomes by reference to which the achievement of the main objectives may be measured, and

(3) Ministers may approve the corporate plan subject to such modifications as may be agreed between them and Revenue Scotland.

(4) If Ministers approve a corporate plan, Revenue Scotland must—

(a) publish the plan as Revenue Scotland considers appropriate, and

(b) lay a copy of the plan before the Scottish Parliament.

(5) During the planning period to which a corporate plan relates, Revenue Scotland may review the plan and submit a revised corporate plan to Ministers for approval.

(6) Subsections (2) to (4) apply to a revised corporate plan as they apply to a corporate plan.

(7) “Planning period” means—

(a) a first period specified by the Scottish Ministers by order, and

(b) each subsequent period of 3 years.

(8) The Scottish Ministers may by order substitute for the period for the time being specified in subsection (7)(b) such other period as they consider appropriate.

Annual report

12

(1) As soon as possible after the end of each financial year, Revenue Scotland must—

(a) prepare and publish a report on the exercise of its functions during that year,

(b) send a copy of the report to the Scottish Ministers, and

(2) “Financial year” means—

(a) the period beginning with the establishment of Revenue Scotland and ending on 31 March in the following year, and

(b) each subsequent period of a year ending on 31 March.

(3) Revenue Scotland may publish such other reports and information on matters relevant to its functions as it considers appropriate.

PART 3 — Information

Use of information by Revenue Scotland etc.

Use of information by Revenue Scotland and other persons

13

(1) A relevant person may use information held by the person in connection with a function in connection with any other function.

(2) In this section and section 14 “relevant person” means any or all of the following persons—

(a) Revenue Scotland,

(b) a member of Revenue Scotland,

(d) the chief executive or any other member of staff of Revenue Scotland,

(e) a person to whom Revenue Scotland has delegated any of its functions,

(f) a member of staff of a person mentioned in paragraph (e).

(3) In this section and section 14 references to a “function” are references to—

(a) a function of any of the persons mentioned in subsection (2)(a) to (d),

(b) in the case of a person mentioned in subsection (2)(e)—

(i) a function which Revenue Scotland has delegated to the person, and

(ii) a function under any other enactment,

(i) a function which Revenue Scotland has delegated to the person and which the member of staff is exercising, and

(ii) a function of the person under any other enactment which the member of staff is exercising.

Protected taxpayer information

14

(1) “Protected taxpayer information” means information relating to a person—

(a) which is held by a relevant person in connection with a function of Revenue Scotland, and

(b) by which a person may be identified.

(2) Subsection (1)(a) does not apply to information about internal administrative arrangements of Revenue Scotland or of a person to whom Revenue Scotland has delegated any of its functions (whether the information relates to members or staff of Revenue Scotland or of such a person or to other persons).

(3) For the purposes of subsection (1)(b) a person may be identified by information if—

(a) the person's identity is specified in the information, or

(b) the person's identity can be deduced from the information (whether from that information on its own or from that information taken together with other information disclosed by or on behalf of Revenue Scotland).

Confidentiality of protected taxpayer information

15

(1) A relevant official must not disclose protected taxpayer information unless the disclosure is permitted by subsection (3).

(2) In this section and section 16 “relevant official” means any individual who is or was—

(a) a member of Revenue Scotland,

(b) a member of a committee of Revenue Scotland,

(d) exercising functions on behalf of Revenue Scotland.

(3) A disclosure is permitted by this subsection if—

(a) it is made with the consent of each person to whom the information relates,

(b) it is made in accordance with any provision made by or under this Act or any other enactment requiring or permitting the disclosure,

(d) it is made for the purposes of civil proceedings,

(e) it is made for the purposes of a criminal investigation or criminal proceedings or for the purposes of the prevention or detection of crime,

(f) it is made in pursuance of an order of a court or tribunal,

(g) it is made to a person exercising functions on behalf of Revenue Scotland (other than a person to whom Revenue Scotland has delegated any of its functions) for the purposes of those functions.

Protected taxpayer information: declaration of confidentiality

16

(1) Each relevant official must make a declaration acknowledging the obligation of confidentiality under section 15.

(2) A declaration must be made—

(a) as soon as reasonably practicable following the person's appointment, and

(b) in such form and manner as Revenue Scotland may determine.

(3) For the purposes of subsection (2)(a)—

(a) the renewal of a fixed term appointment is not to be treated as an appointment,

(b) a person mentioned in section 15(2)(d) is to be treated as appointed when the person begins to exercise functions on behalf of Revenue Scotland.

Other limits on use and disclosure of information

Disclosure of information prohibited or restricted by statute or agreement

17

Sections 13(1) and 15(3) are subject to any provision which prohibits or restricts the use of information and which is contained in—

(a) this Act,

(b) any other enactment,

(c) an international or other agreement to which the United Kingdom, Her Majesty's Government or the Scottish Ministers is or are party.

Protected taxpayer information: use by the Keeper

18

(1) This section applies to information that—

(a) is held by the Keeper in connection with a function which Revenue Scotland has delegated to the Keeper, and

(b) is protected taxpayer information.

(2) The Keeper may not use that information in connection with the Keeper's functions under section 108 of the Land Registration etc. (Scotland) Act 2012 (asp 5).

Offence of wrongful disclosure

Wrongful disclosure of protected taxpayer information

19

(1) A person commits an offence if the person discloses protected taxpayer information contrary to section 15(1).

(2) It is a defence for a person charged with an offence under subsection (1) to prove that the person reasonably believed—

(a) that the disclosure was lawful under section 15, or

(b) that the information had already lawfully been made available to the public.

(3) A person who commits an offence under subsection (1) is liable—

(a) on summary conviction, to imprisonment for a term not exceeding 12 months or a fine not exceeding the statutory maximum (or both),

(b) on conviction on indictment, to imprisonment for a term not exceeding 2 years or a fine (or both).

(4) This section does not affect the pursuit of any remedy or the taking of any action in relation to a contravention of section 15(1).

PART 4 — The Scottish Tax Tribunals

CHAPTER 1 — Introductory

Overview

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CHAPTER 2 — Establishment and leadership

Establishment

The First-tier Tax Tribunal for Scotland and the Upper Tax Tribunal for Scotland

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Leadership

President of the Tax Tribunals

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Functions of the President of the Tax Tribunals

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Business arrangements

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Temporary President

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CHAPTER 3 — Membership

Membership of Tax Tribunals

Members

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Judicial members

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Status and capacity

Status and capacity of members

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CHAPTER 4 — Decision-making and composition

Decision-making and composition: general

Decisions in the First-tier Tribunal

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Decisions in the Upper Tribunal

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Composition of the Tribunals

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Decisions by two or more members

Voting for decisions

32

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Chairing members

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CHAPTER 5 — Appeal of decisions

Appeal from First-tier Tribunal

Appeal from the First-tier Tribunal

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Disposal of an appeal under section 34

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Appeal from Upper Tribunal

Appeal from the Upper Tribunal

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Disposal of an appeal under section 36

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Procedure on second appeal

38

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Further provision on permission to appeal

Process for permission

39

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CHAPTER 6 — Special jurisdiction

Judicial review cases

40

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Procedural steps where petition remitted

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Decision on remittal

42

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Additional matters

43

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Meaning of judicial review

44

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CHAPTER 7 — Powers and enforcement

Venue for hearings

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Conduct of cases

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Enforcement of decisions

47

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Award of expenses

48

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Additional powers

49

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Offences in relation to proceedings

50

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CHAPTER 8 — Practice and procedure

Tribunal rules: general

Tribunal rules

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Exercise of functions

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Extent of rule-making

53

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Particular matters

Proceedings and steps

54

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Hearings in cases

55

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Evidence and decisions

56

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Issuing directions

Practice directions

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CHAPTER 9 — Administration

Administrative support

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Guidance

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Annual reporting

60

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CHAPTER 10 — Interpretation

Interpretation

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PART 5 — The general anti-avoidance rule

Introductory

The general anti-avoidance rule: introductory

62

(1) This Part has effect for the purpose of counteracting tax advantages arising from tax avoidance arrangements that are artificial.

(2) The rules in this Part are collectively to be known as “the general anti-avoidance rule”.

Artificial tax avoidance arrangements

Tax avoidance arrangements

63

(1) An arrangement (or series of arrangements) is a tax avoidance arrangement if, having regard to all the circumstances, it would be reasonable to conclude that obtaining a tax advantage is the main purpose, or one of the main purposes, of the arrangement.

(2) An “arrangement”—

(a) includes any transaction, scheme, action, operation, agreement, grant, understanding, promise, undertaking or event (whether legally enforceable or not), and

(b) may comprise one or more stages or parts.

Meaning of “artificial”

64

(1) A tax avoidance arrangement is artificial if condition A or B is met.

(2) Condition A is met if the entering into or carrying out of the arrangement is not a reasonable course of action in relation to the tax provisions in question having regard to all the circumstances, including—

(a) whether the substantive results of the arrangement are consistent with—

(i) any principles on which those provisions are based (whether express or implied), and

(ii) the policy objectives of those provisions,

(b) whether the arrangement is intended to exploit any shortcomings in those provisions.

(3) Condition B is met if the arrangement lacks economic or commercial substance.

(4) Each of the following is an example of something which might indicate that a tax avoidance arrangement lacks economic or commercial substance—

(a) whether the arrangement is carried out by a person in a manner which would not normally be employed in reasonable business conduct,

(b) whether the legal characterisation of the steps in the arrangement is inconsistent with the legal substance of the arrangement as a whole,

(d) whether transactions are circular in nature,

(e) whether the arrangement results in a tax advantage that is not reflected in the business risks undertaken by the taxpayer.

(5) The fact that—

(a) a tax avoidance arrangement accords with established practice, and

(b) Revenue Scotland had, at the time the arrangement was entered into, indicated its acceptance of that practice,

is an example of something that might indicate that the arrangement is not artificial.

(6) The examples given in subsections (4) and (5) are not exhaustive.

(7) Where a tax avoidance arrangement forms part of any other arrangements, regard must also be had to those other arrangements.

Meaning of “tax advantage”

65

(1) A “tax advantage” includes in particular—

(a) relief or increased relief from tax,

(b) repayment or increased repayment of tax,

(d) avoidance of a possible assessment to tax, and

(e) deferral of a payment of tax or advancement of a repayment of tax.

(2) In determining whether a tax avoidance arrangement has resulted in a tax advantage, regard may be had to the amount of tax that would have been payable in the absence of the arrangement.

Counteracting tax advantages

66

(1) Revenue Scotland may make such adjustments as it considers just and reasonable to counteract the tax advantages that would (ignoring this Part) arise from a tax avoidance arrangement that is artificial.

(2) The adjustments may be made in respect of the tax in question or any other devolved tax.

(3) The adjustments that may be made include (but are not restricted to) those that impose or increase a liability to tax in any case where (ignoring this Part) there would be no liability or a smaller liability, and tax is to be charged in accordance with any such adjustment.

(4) Any adjustments required to be made under this section (whether by Revenue Scotland or the person to whom the tax advantage would arise) may be made by—

(a) the amendment of a return (see sections 83, 87 and 93),

(b) the correction of a return (see section 84),

(d) the making of a tax return (see section 97),

(e) the making of a Revenue Scotland assessment (see section 100),

(f) the entering into of a contract settlement (see section 118), or

(g) such other method as Revenue Scotland considers appropriate.

(5) No steps may be taken by Revenue Scotland unless the procedural requirements of sections 68 and 69 have been complied with.

(6) The power to make adjustments by virtue of this section is subject to any time limit imposed by or under Part 6, any other provision of this Act or any other enactment.

Proceedings in connection with the general anti-avoidance rule

67

(1) In proceedings before a court or tribunal in connection with the general anti-avoidance rule, Revenue Scotland must show—

(a) that there is a tax avoidance arrangement that is artificial, and

(b) that the adjustments made to counteract the tax advantages arising from the tax avoidance arrangement are just and reasonable.

(2) In determining any issue in connection with the general anti-avoidance rule, a court or tribunal must take into account any guidance published by Revenue Scotland about the general anti-avoidance rule (at the time the tax avoidance arrangement was entered into).

(3) In determining any issue in connection with the general anti-avoidance rule, a court or tribunal may take into account—

(a) guidance, statements or other material (whether by Revenue Scotland or anyone else) that was in the public domain at the time the tax avoidance arrangement was entered into, and

(b) evidence of established practice at that time.

Notice to taxpayer of proposed counteraction of tax advantage

68

(1) If a designated officer considers—

(a) that a tax advantage has arisen to a person (“the taxpayer”) from a tax avoidance arrangement that is artificial, and

(b) that the advantage should be counteracted under section 66,

the officer must give the taxpayer a notice to that effect.

(2) The notice must—

(a) specify the tax avoidance arrangement and the tax advantage,

(b) explain why the officer considers that a tax advantage has arisen to the taxpayer from a tax avoidance arrangement that is artificial,

(d) inform the taxpayer of the period under subsection (4) for making representations.

(3) The notice may set out the steps that the taxpayer may take to avoid the proposed counteraction.

(4) If a notice is given to a taxpayer under subsection (1), the taxpayer has 45 days beginning with the day on which the notice is given to send representations to the designated officer in response to the notice.

(5) The designated officer may, on a request made by the taxpayer, extend the period during which representations may be made.

(6) The designated officer must take into account any representations made by the taxpayer.

Final notice to taxpayer of counteraction of tax advantage

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(1) The designated officer must, after the expiry of the period in which representations may be made under section 68, give the taxpayer a notice setting out whether the tax advantage arising from the tax avoidance arrangement is to be counteracted under the general anti-avoidance rule.

(2) If the notice states that a tax advantage is to be counteracted, the notice must also set out—

(a) the adjustments required to give effect to the counteraction, and

(b) if relevant, any steps that the taxpayer is required to take to give effect to it and the period within which those steps must be taken.

Counteraction of tax advantages: payment of tax charged etc.

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(1) This section applies where—

(a) a designated officer gives a taxpayer a notice under section 69, and

(b) the notice sets out the adjustments required to give effect to the counteraction of a tax advantage.

(2) The taxpayer must pay any amount, or additional amount, of tax chargeable or penalty or interest imposed as a result of the adjustments before the end of the period of 30 days beginning with the date on which the notice is issued.

(3) Subsection (2) applies in place of any other provision of this Act or any other enactment which specifies a time limit for the payment of tax, penalty or interest.

Assumption of tax advantage

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(1) A designated officer may give a notice under section 68 or 69 where the officer considers that a tax advantage might have arisen to the taxpayer.

(2) Accordingly, any notice given by a designated officer under section 68 or 69 may be expressed to be given on the assumption that the tax advantage does arise (without agreeing that it does).

General anti-avoidance rule: commencement and transitional provision

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(1) The general anti-avoidance rule has effect in relation to any tax avoidance arrangement entered into on or after the date on which this Part comes into force.

(2) Where the tax avoidance arrangement forms part of any other arrangements entered into before that day, those other arrangements are to be ignored for the purposes of section 64(7), subject to subsection (3).

(3) Account is to be taken of those other arrangements if, as a result, the tax avoidance arrangement would not be artificial.

PART 6 — Tax returns, enquiries and assessments

CHAPTER 1 — Overview

Overview

73

This Part makes provision about the assessment of devolved taxes including—

(a) taxpayers' duties in relation to tax records,

(b) the timing of tax returns,

(d) enquiries by Revenue Scotland into taxpayers' self-assessments,

(e) determination by Revenue Scotland of tax due where no return is made,

(f) assessment by Revenue Scotland of tax due outwith enquiries where tax losses or other situations are brought about by taxpayers carelessly or deliberately, and

(g) claims for relief from double assessment and for repayment of tax.

CHAPTER 2 — Taxpayer duties to keep and preserve records

Duties to keep records

Duty to keep and preserve records

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(1) A person who is required to make a tax return in relation to a devolved tax must—

(a) keep any records that may be needed to enable the person to make a correct and complete return, and

(b) preserve those records in accordance with this section.

(2) The records mentioned in subsection (1) must be preserved until the end of the later of the relevant day and the date on which—

(a) an enquiry into the return is completed, or

(b) if there is no enquiry, a designated officer no longer has power to enquire into the return.

(3) A person who is liable to be registered for tax (a “registrable person”) must—

(a) keep any records that may be needed to enable the registrable person to comply with a requirement to notify Revenue Scotland of the person's intention—

(i) to carry out taxable activities, or

(ii) to cease to carry out taxable activities,

(b) make records relating to material at a landfill site or part of a landfill site, and

(4) The records mentioned in subsection (3) must be preserved until the end of the relevant day.

(5) “The relevant day” in relation to records mentioned in subsection (1) means—

(a) the fifth anniversary of the day on which the return is made or, if the return is amended, the day notice of the amendment is given under section 83, or

(b) any earlier day that may be specified by Revenue Scotland.

(6) The “relevant day” in relation to records mentioned in subsection (3) means—

(a) in the case of records mentioned in subsection (3)(a), the fifth anniversary of the day on which the notice was given,

(b) in the case of records mentioned in subsection (3)(b), the fifth anniversary of the day on which the record was made, or

(7) Different days may be specified for different purposes under subsection (5)(b) or (6)(c).

(8) The records required to be kept and preserved under subsection (1) include—

(a) details of any relevant transaction (including relevant instruments relating to any transaction, in particular, any contract or conveyance, and any supporting maps, plans or similar documents),

(b) details of any relevant taxable activity,

(9) The Scottish Ministers may by regulations—

(a) provide that the records required to be kept and preserved under this section do, or do not, include records specified in the regulations, and

(b) specify supporting documents that are required to be kept under this section.

(10) Regulations under this section may make provision by reference to things specified in a notice published by Revenue Scotland in accordance with the regulations (and not withdrawn by a subsequent notice).

(11) “Supporting documents” includes accounts, books, deeds, contracts, vouchers and receipts.

Preservation of information etc.

75

The duty under section 74 to preserve records may be satisfied—

(a) by preserving them in any form and by any means, or

(b) by preserving the information contained in them in any form and by any means, subject to any conditions or exceptions prescribed by the Scottish Ministers by regulations.

Penalties for failing to keep and preserve records

Penalty for failure to keep and preserve records

76

(1) A person (“P”) who fails to comply with section 74 in relation to a devolved tax is liable to a penalty not exceeding £3,000, subject to the following exception.

(2) No penalty is incurred if Revenue Scotland is satisfied that any facts that it reasonably requires to be proved, and that would have been proved by the records, are proved by other documentary evidence provided to Revenue Scotland.

Reasonable excuse for failure to keep and preserve records

77

(1) If P satisfies Revenue Scotland or (on appeal) the tribunal that there is a reasonable excuse for a failure to comply with section 74, liability to a penalty under section 76 does not arise in relation to that failure.

(2) For the purposes of subsection (1)—

(a) an insufficiency of funds is not a reasonable excuse unless attributable to events outside P's control,

(b) where P relies on any other person to do anything, that is not a reasonable excuse unless P took reasonable care to avoid the failure, and

(c) where P had a reasonable excuse for the failure but the excuse has ceased, P is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased.

Assessment of penalties under section 76

78

(1) Where a person becomes liable to a penalty under section 76, Revenue Scotland must—

(a) assess the penalty, and

(b) notify the person.

(2) An assessment of a penalty under section 76 must be made within the period of 12 months beginning with the date on which the person became liable to the penalty.

Enforcement of penalties under section 76

79

(1) A penalty under section 76 must be paid—

(a) before the end of the period of 30 days beginning with the date on which the notification under section 78 was issued,

(b) if a notice of review against the penalty is given, before the end of the period of 30 days beginning with the date on which the review is concluded,

(c) if, following review, mediation is entered into, before the end of the period of 30 days beginning with the date either Revenue Scotland or the person who gave the notice of review gave notice of withdrawal from mediation, or

(d) if a notice of an appeal against the penalty is given, before the end of the period of 30 days beginning with the date on which the appeal is determined or withdrawn.

(2) A penalty under section 76 is to be treated for enforcement purposes as an assessment to tax.

Power to change penalty provisions in sections 76 to 79

80

(1) The Scottish Ministers may by regulations make provision (or further provision) about penalties under this Chapter.

(2) Provision under subsection (1) includes provision—

(a) about the circumstances in which a penalty is payable,

(b) about the amounts of penalties,

(d) about appealing penalties,

(e) about enforcing penalties.

(3) Regulations under subsection (1) may not create criminal offences.

(4) Regulations under subsection (1) may modify any enactment (including this Act).

(5) Regulations under subsection (1) do not apply to a failure which began before the date on which the regulations come into force.

Duty to keep and preserve records: further provision

Further provision: land and buildings transaction tax

81

(1) This section applies in relation to land and buildings transaction tax.

(2) The Scottish Ministers may by regulations make provision for the keeping and preservation of records in relation to land transactions that are not notifiable.

(3) Regulations under this section may require the buyer in a land transaction which is not notifiable to—

(a) keep such records as may be needed to enable the buyer to demonstrate that the transaction is not notifiable, and

(b) preserve those records in accordance with the regulations.

(4) The regulations may apply sections 74 to 79 (with or without modifications) to a buyer mentioned in subsection (3) as those sections apply to a person mentioned in section 74(1).

(5) Expressions used in this section and in the LBTT(S) Act 2013 have the meanings given in that Act.

CHAPTER 3 — Tax returns

Filing dates

Meaning of “filing date”

82

In this Act “the filing date” in relation to a tax return is the date by which that return requires to be made by or under any enactment.

Amendment and correction of returns

Amendment of return by taxpayer

83

(1) A person (the “taxpayer”) who has made a tax return may amend the return by notice to Revenue Scotland.

(2) An amendment under this section must be made by the end of the period of 12 months beginning with the relevant date (the “amendment period”).

(3) The relevant date is—

(a) the filing date, or

(b) such other date as the Scottish Ministers may by order prescribe.

(4) This section is subject to sections 87(3) and 93(4).

Correction of return by Revenue Scotland

84

(1) Revenue Scotland may correct any obvious error or omission in a tax return.

(2) A correction under this section—

(a) is made by notice to the taxpayer, and

(b) is regarded as effecting an amendment of the return.

(3) The reference in subsection (1) to an error includes, for instance, an arithmetical mistake or an error of principle.

(4) A correction under this section must be made by the end of the period of 12 months beginning with the day on which the return was made.

(5) A correction under this section has no effect if the taxpayer rejects it by—

(a) during the amendment period, amending the return so as to reject the correction, or

(b) after that period, giving a notice rejecting the correction.

(6) A notice under subsection (5)(b) must be given to Revenue Scotland before the end of the period of 3 months beginning with the date of issue of the notice of correction.

CHAPTER 4 — Revenue Scotland enquiries

Notice and scope of enquiry

Notice of enquiry

85

(1) A designated officer may enquire into a tax return if subsection (2) has been complied with.

(2) Notice of the intention to make an enquiry must be given—

(a) to the person by whom or on whose behalf the return was made (“the relevant person”),

(b) before the end of the period of 3 years after the relevant date.

(3) The relevant date is—

(a) the filing date, if the return was made on or before that date, or

(b) the date on which the return was made, if the return was made after the filing date.

(4) A return that has been the subject of one notice under this section may not be the subject of another, except a notice given in consequence of an amendment of the return under section 83.

(5) A notice under this section is referred to as a “notice of enquiry”.

Scope of enquiry

86

(1) An enquiry extends to anything contained in the tax return, or required to be contained in the return, that relates—

(a) to the question whether the relevant person is chargeable to the devolved tax to which the return relates, or

(b) to the amount of tax chargeable on the relevant person.

(2) Subsection (3) applies if the notice of enquiry is given as a result of the amendment of a return under section 83 after an enquiry into the return has been completed.

(3) The enquiry is limited to—

(a) matters to which the amendment relates, and

(b) matters affected by the amendment.

Amendment of return during enquiry

Amendment of self-assessment during enquiry to prevent loss of tax

87

(1) If, at a time when an enquiry is in progress into a tax return, a designated officer forms the opinion—

(a) that the amount stated in the self-assessment contained in the return as the amount of tax payable is insufficient, and

(b) that unless the assessment is immediately amended there is likely to be a loss of tax to the Crown,

the officer may by notice to the relevant person amend the assessment to make good the deficiency.

(2) If the enquiry is one that is limited by section 86(2) and (3) to matters arising from an amendment of the return, subsection (1) applies only so far as the deficiency is attributable to the amendment.

(3) Where a designated officer gives notice under subsection (1), section 83 does not apply.

(4) The taxpayer must pay any amount, or additional amount, of tax chargeable as a result of an amendment under this section immediately on receipt of notice of the amendment.

(5) For the purposes of this section and section 88 the period during which an enquiry is in progress is the whole of the period—

(a) beginning with the day on which the notice of enquiry is given, and

(b) ending with the day on which the enquiry is completed.

Referral during enquiry

Referral of questions to appropriate tribunal during enquiry

88

(1) At any time when an enquiry is in progress into a tax return any question arising in connection with the subject-matter of the return may be referred to the appropriate tribunal for determination.

(2) Notice of the referral must be given to the appropriate tribunal jointly by the relevant person and a designated officer.

(3) More than one notice of referral may be given under this section in relation to an enquiry.

Withdrawal of notice of referral

89

A designated officer or the relevant person may withdraw a notice of referral under section 88.

Effect of referral on enquiry

90

(1) While proceedings on a referral under section 88 are in progress in relation to an enquiry—

(a) no closure notice may be given in relation to the enquiry, and

(b) no application may be made for a direction to give a closure notice.

(2) Proceedings on a referral are “in progress” where—

(a) notice of referral has been given and has not been withdrawn, and

(b) the question referred has not been finally determined.

(3) A question referred has been “finally determined” when—

(a) it has been determined by the appropriate tribunal, and

(b) there is no further possibility of the determination being varied or set aside (disregarding any power to grant permission to appeal out of time).

Effect of determination

91

(1) A determination under section 88 is binding on the parties to the referral in the same way, and to the same extent, as a decision on a preliminary plea in an appeal.

(2) The designated officer conducting the enquiry must take the determination into account—

(a) in reaching conclusions on the enquiry, and

(b) in the formulation of any amendments of the tax return that may be required to give effect to those conclusions.

(3) The question determined may not be reopened on an appeal, except to the extent that it could be reopened if it had been determined as a preliminary plea in that appeal.

“Appropriate tribunal”

92

(1) Where the question to be referred under section 88 is of the market value of any land, the appropriate tribunal is the Lands Tribunal for Scotland.

(2) In any other case a referral under section 88 is to be made to—

(a) the First-tier Tribunal,

(b) where determined by or under tribunal rules, the Upper Tribunal, or

(3) References to the “appropriate tribunal” in sections 88 and 90 are to be read accordingly.

Completion of enquiry

93

(1) An enquiry under section 85 is completed—

(a) when a designated officer informs the relevant person by a notice (a “closure notice”) that the enquiry is complete and states the conclusions reached in the enquiry, or

(b) no closure notice having been given, 3 years after the relevant date.

(2) A closure notice must be given no later than 3 years after the relevant date.

(3) A closure notice must either—

(a) state that in the officer's opinion no amendment of the tax return is required, or

(b) make the amendments of the return required to give effect to the officer's conclusions.

(4) Where a closure notice is given which makes amendments of a return as mentioned in subsection (3)(b), section 83 does not apply.

(5) A closure notice takes effect when it is issued.

(6) The taxpayer must pay any amount, or additional amount, of tax chargeable as a result of an amendment made by a closure notice before the end of the period of 30 days beginning with the day on which the notice is given.

(7) In subsections (1) and (2) “relevant date” has the same meaning as in section 85.

Direction to complete enquiry

94

(1) The relevant person may apply to the tribunal for a direction that a closure notice is to be given within a specified period.

(2) The tribunal hearing the application must give a direction unless satisfied that Revenue Scotland has reasonable grounds for not giving a closure notice within that period.

(3) In this paragraph “the tribunal” means—

(a) the First-tier Tribunal, or

(b) where determined by or under tribunal rules, the Upper Tribunal.

CHAPTER 5 — Revenue Scotland determinations

Determination of tax chargeable if no return made

95

(1) This section applies where—

(a) Revenue Scotland has reason to believe that a person (“P”) is chargeable to a devolved tax,

(b) P has not made a tax return in relation to that liability, and

(2) “The relevant filing date” means the date by which Revenue Scotland believes a return was required to be made.

(3) Revenue Scotland may make a determination (a “Revenue Scotland determination”) to the best of its information and belief of the amount of tax to which P is chargeable.

(4) Notice of the determination must be given to P and must state the date on which it is issued.

(5) P must pay the tax chargeable as a result of the determination immediately on receipt of notice of the determination.

(6) No Revenue Scotland determination may be made more than 5 years after the relevant date.

(7) The relevant date is—

(a) the relevant filing date, or

(b) such other date as the Scottish Ministers may by order prescribe.

Determination to have effect as a self-assessment

96

(1) A Revenue Scotland determination has effect for enforcement purposes as if it were a self-assessment made by P.

(2) In subsection (1) “for enforcement purposes” means for the purposes of Part 10.

(3) Nothing in this section affects any liability of a person to a penalty for failure to make a tax return.

Determination superseded by actual self-assessment

97

(1) If, after a Revenue Scotland determination has been made, P makes a tax return with respect to the tax in question, the self-assessment included in that return supersedes the determination.

(2) Subsection (1) does not apply to a return made—

(a) more than 5 years after the power to make the determination first became exercisable, or

(b) more than 3 months after the date of the determination,

whichever is the later.

(3) Where—

(a) proceedings have been begun for the recovery of any tax charged by a Revenue Scotland determination, and

(b) before the proceedings are concluded the determination is superseded by a self-assessment,

the proceedings may be continued as if they were proceedings for the recovery of so much of the tax charged by the self-assessment as is due and payable and has not yet been paid.

CHAPTER 6 — Revenue Scotland assessments

Assessment of loss of tax or of excessive repayment

Assessment where loss of tax

98

(1) This section applies if a designated officer comes to the view honestly and reasonably that—

(a) an amount of devolved tax that ought to have been assessed as tax chargeable on a person has not been assessed,

(b) an assessment of the tax chargeable on a person is or has become insufficient, or

(2) The designated officer may make an assessment of the amount, or additional amount, that ought in the officer's opinion to be charged in order to make good to the Crown the loss of tax.

Assessment to recover excessive repayment of tax

99

(1) If an amount of tax has been, but ought not to have been, repaid to a person that amount may be assessed and recovered as if it were unpaid tax.

(2) If the repayment was made with interest, the amount assessed and recovered may include the amount of interest that ought not to have been paid.

References to “Revenue Scotland assessment”

100

In this Act “Revenue Scotland assessment” means an assessment under section 98(2) or 99(1), as the case may be.

References to the “taxpayer”

101

In sections 102 to 105 “taxpayer” means—

(a) in relation to an assessment under section 98, the person chargeable to the tax,

(b) in relation to an assessment under section 99, the person mentioned in section 99(1).

Conditions for making Revenue Scotland assessments

102

(1) A Revenue Scotland assessment may be made only where the situation mentioned in section 98(1) or 99(1) was brought about carelessly or deliberately by—

(a) the taxpayer,

(b) a person acting on the taxpayer's behalf, or

(2) But no Revenue Scotland assessment may be made if—

(a) the situation mentioned in section 98(1) or 99(1) is attributable to a mistake in the return as to the basis on which the tax liability ought to have been calculated, and

(b) the return was in fact made on the basis prevailing, or in accordance with the practice generally prevailing, at the time it was made.

Time limits for Revenue Scotland assessments

103

(1) The general rule is that no Revenue Scotland assessment may be made more than 5 years after the relevant date.

(2) An assessment of a person in any case involving a loss of tax or a situation brought about deliberately by the taxpayer or a related person may be made up to 20 years after the relevant date.

(3) An assessment under section 99 (assessment to recover excessive repayment of tax) is not out of time if it is made within the period of 12 months beginning with the date on which the repayment in question was made.

(4) If the taxpayer has died—

(a) any assessment on the personal representatives must be made within 3 years after the death, and

(b) an assessment is not to be made by virtue of subsection (1) in respect of a relevant date more than 5 years before the death.

(5) Any objection to the making of an assessment on the ground that the time limit for making it has expired can only be made on a review or appeal against the assessment.

(6) In this section—

“related person”, in relation to the taxpayer, means—a person acting on the taxpayer's behalf, ora person who was the partner of the taxpayer,

“relevant date” means—the filing date, orthe date on which the return was made, if the return was made after the filing date.

Losses brought about carelessly or deliberately

104

(1) This section applies for the purposes of sections 102 and 103.

(2) A loss of tax or a situation is brought about carelessly by a person if the person fails to take reasonable care to avoid bringing about that loss or situation.

(3) Subsection (4) applies where—

(a) information is provided to Revenue Scotland,

(b) the person who provided the information, or the person on whose behalf the information was provided, discovers some time later that the information was inaccurate, and

(4) Any loss of tax or situation brought about by the inaccuracy is to be treated as having been brought about carelessly by that person.

(5) References to a loss of tax or to a situation brought about deliberately by a person include a loss of tax or situation brought about as a result of a deliberate inaccuracy in a document given to Revenue Scotland by or on behalf of that person.

Notice of assessment and other procedure

Assessment procedure

105

(1) Notice of a Revenue Scotland assessment must be served on the taxpayer.

(2) The notice must state—

(a) the tax due,

(b) the date on which the notice is issued,

(i) the amount, or additional amount, of tax chargeable as a result of the assessment (as mentioned in section 98(2)), or

(ii) the amount of tax or interest repaid that ought not to have been (as mentioned in section 99(1)),

must be paid, and

(d) the time within which any review or appeal against the assessment must be requested.

(3) The—

(a) amount, or additional amount, of tax chargeable as a result of the assessment (as mentioned in section 98(2)), or

(b) amount of tax or interest repaid that ought not to have been (as mentioned in section 99(1)),

must be paid before the end of the period of 30 days beginning with the date on which the assessment is issued.

(4) After notice of the assessment has been served on the taxpayer, the assessment may not be altered except in accordance with the express provisions of this Part or of Part 5.

(5) Where a designated officer has decided to make an assessment to tax, and has taken all other decisions needed for arriving at the amount of the assessment, the officer may entrust to some other designated officer the responsibility for completing the assessment procedure, whether by means involving the use of a computer or otherwise, including responsibility for serving notice of the assessment.

CHAPTER 7 — Relief in case of excessive assessment or overpaid tax

Double assessment

Relief in case of double assessment

106

A person who believes that tax has been assessed on that person more than once in respect of the same matter may make a claim to Revenue Scotland for relief against any double charge.

Overpaid tax etc.

Claim for relief for overpaid tax etc.

107

(1) This section applies where—

(a) a person has paid an amount by way of tax but believes the tax was not chargeable, or

(b) a person has been assessed as chargeable to an amount of tax, or a determination has been made that a person is chargeable to an amount of tax, but the person believes the tax is not chargeable.

(2) The person may make a claim to Revenue Scotland for the amount to be repaid or discharged.

(3) Where this section applies, Revenue Scotland is not liable to give relief, except as provided in this Part or by or under any other provision of this Act.

(4) For the purposes of this section and sections 109 to 118, an amount paid by one person on behalf of another is treated as paid by the other person.

Order changing tax basis not approved

Claim for repayment if order changing tax basis not approved

108

(1) This section applies where a relevant order has ceased to have effect by virtue of a relevant provision and—

(a) a person has paid an amount by way of tax that would not have been payable but for the order, or

(b) a person has been assessed as chargeable to an amount of tax, or a determination has been made that a person is chargeable to an amount of tax, that would not have been chargeable but for the order.

(2) The person may make a claim to Revenue Scotland—

(a) for the amount of tax, and

(b) any related penalty or interest,

to be repaid or discharged to the extent that it was paid, or assessed or determined as chargeable, in consequence of the relevant order.

(3) A “relevant order” is an order mentioned in column 1, and a “relevant provision”, in relation to such an order, is the provision mentioned in the corresponding entry in column 2, of the following table.

Relevant orders	Relevant provisions
Under the LBTT(S) Act 2013—a second or subsequent order under section 24(1), an order under paragraph 19(1) or (2) of schedule 2A, a second or subsequent order under paragraph 3(1) of schedule 19.	Section 68(4)(b) of that Act
Under the LT(S) Act 2014—an order under section 5(5) providing for anything which would otherwise not be a disposal of material by way of landfill to be such a disposal,an order under section 6(1) which produces the result that a landfill site activity which would otherwise not be prescribed for the purposes of section 6 is so prescribed,a second or subsequent order under section 13(2) or (5),an order under section 13(4),an order under section 14(7) other than one which provides only that an earlier order under section 14(7) is not to apply to material.	Section 41(3)(b) of that Act

Relevant orders

Relevant provisions

Under the LBTT(S) Act 2013—a second or subsequent order under section 24(1), an order under paragraph 19(1) or (2) of schedule 2A, a second or subsequent order under paragraph 3(1) of schedule 19.

Section 68(4)(b) of that Act

Under the LT(S) Act 2014—an order under section 5(5) providing for anything which would otherwise not be a disposal of material by way of landfill to be such a disposal,an order under section 6(1) which produces the result that a landfill site activity which would otherwise not be prescribed for the purposes of section 6 is so prescribed,a second or subsequent order under section 13(2) or (5),an order under section 13(4),an order under section 14(7) other than one which provides only that an earlier order under section 14(7) is not to apply to material.

Section 41(3)(b) of that Act

(4) A penalty or interest is related to an amount of tax to the extent that it—

(a) is attributable to the amount, and

(b) would not have been incurred but for the relevant order.

(5) A claim for repayment must be made before the end of the period of 2 years after the relevant date.

(6) The relevant date is—

(a) the filing date, or

(b) the date on which the tax return was made, if the return was made after the filing date.

(7) For the purposes of this section and sections 109 to 112, 114, 116 and 118, an amount paid by one person on behalf of another is treated as paid by the other person.

(8) Expressions used in this section and in the LT(S) Act 2014 have the meanings given in that Act.

Defence of unjustified enrichment

Defence to certain claims for relief under section 107 or 108

109

It is a defence to a claim for relief made under section 107 or 108 that repayment or, as the case may be, discharge of the amount would unjustly enrich the claimant.

Unjustified enrichment: further provision

110

(1) This section applies where—

(a) there is an amount paid by way of tax which (apart from section 109) would fall to be repaid or discharged to any person (“the taxpayer”), and

(b) the whole or a part of the cost of the payment of that amount to Revenue Scotland has, for practical purposes, been borne by a person other than the taxpayer.

(2) Where, in a case to which this section applies, loss or damage has been or may be incurred by the taxpayer as a result of mistaken assumptions made in the taxpayer's case about the operation of any provisions relating to a tax, that loss or damage is to be disregarded, except to the extent of the quantified amount, in the making of any determination—

(a) of whether or to what extent the repayment or discharge of an amount to the taxpayer would enrich the taxpayer, or

(b) of whether or to what extent any enrichment of the taxpayer would be unjust.

(3) In subsection (2) “the quantified amount” means the amount (if any) which is shown by the taxpayer to constitute the amount that would appropriately compensate the taxpayer for loss or damage shown by the taxpayer to have resulted, for any business carried on by the taxpayer, from the making of the mistaken assumptions.

(4) The reference in subsection (2) to provisions relating to a tax is a reference to any provisions of—

(a) any enactment, subordinate legislation or EU legislation (whether or not still in force) which relates to that tax or to any matter connected with it, or

(b) any notice published by Revenue Scotland under or for the purposes of any such enactment or subordinate legislation.

Unjustified enrichment: reimbursement arrangements

111

(1) The Scottish Ministers may by regulations make provision for reimbursement arrangements made by any person to be disregarded for the purposes of section 109 except where the arrangements—

(a) contain such provision as may be required by the regulations, and

(b) are supported by such undertakings to comply with the provisions of the arrangements as may be required by the regulations to be given to Revenue Scotland.

(2) In this section “reimbursement arrangements” means any arrangements for the purposes of a claim under section 107 or 108 which—

(a) are made by any person for the purpose of securing that the person is not unjustly enriched by the repayment or discharge of any amount in pursuance of the claim, and

(b) provide for the reimbursement of persons who have for practical purposes borne the whole or any part of the cost of the original payment of that amount to Revenue Scotland.

(3) Without prejudice to the generality of subsection (1) above, the provision that may be required by regulations under this section to be contained in reimbursement arrangements includes—

(a) provision requiring a reimbursement for which the arrangements provide to be made within such period after the repayment to which it relates as may be specified in the regulations,

(b) provision for the repayment of amounts to Revenue Scotland where those amounts are not reimbursed in accordance with the arrangements,

(c) provision requiring interest paid by Revenue Scotland on any amount repaid by it to be treated in the same way as that amount for the purposes of any requirement under the arrangements to make reimbursement or to repay Revenue Scotland,

(d) provision requiring such records relating to the carrying out of the arrangements as may be described in the regulations to be kept and produced to Revenue Scotland, or to a designated officer.

(4) Regulations under this section may impose obligations on such persons as may be specified in the regulations—

(a) to make the repayments to Revenue Scotland that they are required to make in pursuance of any provisions contained in any reimbursement arrangements by virtue of subsection (3)(b) or (c),

(b) to comply with any requirements contained in any such arrangements by virtue of subsection (3)(d).

(5) Regulations under this section may make provision for the form and manner in which, and the times at which, undertakings are to be given to Revenue Scotland in accordance with the regulations and any such provision may allow for those matters to be determined by Revenue Scotland in accordance with the regulations.

Reimbursement arrangements: penalties

112

(1) Regulations under section 111 may make provision for penalties where a person breaches an obligation imposed by virtue of section 111(4).

(2) The regulations may in particular make provision including provision—

(a) about the circumstances in which a penalty is payable,

(b) about the amounts of penalties,

(c) for fixed penalties, daily penalties and penalties calculated by reference to the amount of repayments which the person would have been liable to make to Revenue Scotland if the obligation had been breached,

(d) about the procedure for issuing penalties,

(e) about appealing penalties,

(f) about enforcing penalties.

(3) But the regulations may not create criminal offences.

(4) Regulations made by virtue of this section may amend any enactment (including this Act).

Other defences to claims

Cases in which Revenue Scotland need not give effect to a claim

113

(1) Revenue Scotland need not give effect to a claim under section 107 if or to the extent that the claim falls within a case described in this section.

(2) Case A is where the amount of tax paid, or liable to be paid, is excessive because of—

(a) a mistake in a claim, or

(b) a mistake consisting of making, or failing to make, a claim.

(3) Case B is where the claimant is or will be able to seek relief by taking other steps under this Part of this Act.

(4) Case C is where the claimant—

(a) could have sought relief by taking such steps within a period that has now expired, and

(b) knew or ought reasonably to have known, before the end of that period, that such relief was available.

(5) Case D is where the claim is made on grounds that—

(a) have been put to a court or tribunal in the course of an appeal by the claimant relating to the amount paid or liable to be paid, or

(b) have been put to Revenue Scotland in the course of a review or appeal by the claimant relating to that amount that is treated as having been determined by the tribunal by virtue of section 246 (settling matters in question by agreement).

(6) Case E is where the claimant knew, or ought reasonably to have known, of the grounds for the claim before the latest of the following—

(a) the date on which a relevant appeal in the course of which the ground could have been put forward was determined by a court or tribunal (or is treated as having been so determined),

(b) the date on which the claimant withdrew a relevant appeal to a court or tribunal,

(7) In subsection (6) “relevant appeal” means an appeal by the claimant relating to the amount paid or liable to be paid.

(8) Case F is where the amount in question was paid or is liable to be paid—

(a) in consequence of proceedings enforcing the payment of that amount brought against the claimant by Revenue Scotland, or

(b) in accordance with an agreement between the claimant and Revenue Scotland settling such proceedings.

(9) Case G is where—

(a) the amount paid, or liable to be paid, is excessive by reason of a mistake in calculating the claimant's liability to tax, and

(b) liability was calculated in accordance with the practice generally prevailing at the time.

(10) Case G does not apply where the amount paid, or liable to be paid, is tax which has been charged contrary to EU law.

(11) For the purposes of subsection (10), an amount of tax is charged contrary to EU law if, in the circumstances in question, the charge to tax is contrary to—

(a) the provisions relating to the free movement of goods, persons, services and capital in Titles II and IV of Part 3 of the Treaty on the Functioning of the European Union, or

(b) the provisions of any subsequent treaty replacing the provisions mentioned in paragraph (a).

Procedure for making claims

Procedure for making claims etc.

114

Schedule 3 applies in relation to claims under sections 106 to 108.

Time-limit for making claims

115

(1) A claim under section 106 or 107 must be made within the period of 5 years after the date by which the tax return, to which the payment by way of tax, or the assessment or determination relates, required to be made.

(2) A claim under section 107 may not be made by being included in a return.

The claimant: partnerships

116

(1) This section is about the application of sections 107 and 108 in a case where either—

(a) (in a case falling within section 107(1)(a) or 108(1)(a)) the person paid the amount in question in the capacity of a responsible partner or representative partner, or

(b) (in a case falling within section 107(1)(b) or 108(1)(b)) the assessment was made on, or the determination related to the liability of, the person in such a capacity.

(2) In such a case, only a relevant person who has been nominated to do so by all of the relevant persons may make a claim under section 107 or 108 in respect of the amount in question.

(3) The relevant persons are all the persons who would have been liable as responsible partners to pay the amount in question had the payment been due or (in a case falling within section 107(1)(b) or 108(1)(b)) had the assessment or determination been correctly made.

Assessment of claimant in connection with claim

117

(1) This section applies where—

(a) a claim is made under section 107,

(b) the grounds for giving effect to the claim also provide grounds for a Revenue Scotland assessment on the claimant in respect of the tax, and

(2) In a case falling within section 116(1)(a) or (b), the reference to the claimant in subsection (1)(b) of this section includes any relevant person (as defined in section 116(3)).

(3) The following are relevant restrictions—

(a) the restrictions in section 102 (conditions for assessment where return has been delivered),

(b) the expiry of a time limit for making a Revenue Scotland assessment.

(4) Where this section applies—

(a) the relevant restrictions are to be disregarded,

(b) the Revenue Scotland assessment is not out of time if it is made before the final determination of the claim.

(5) A claim is not finally determined until it, or the amount to which it relates, can no longer be varied (whether on review, appeal or otherwise).

Contract settlements

118

(1) In sections 107(1)(a) and 108(1)(a) the reference to an amount paid by a person by way of tax includes an amount paid by a person under a contract settlement in connection with tax believed to be due.

(2) Subsections (3) to (7) apply if the person who paid the amount under the contract settlement (“the payer”) and the person from whom the tax was due (“the taxpayer”) are not the same person.

(3) In relation to a claim under section 107 in respect of that amount—

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