Enhanced information and penalty powers for HMRC are now reflected in regulations which require the disclosure of information in relation to notifiable contribution arrangements. Those provisions correspond or apply, with certain modifications, to provisions requiring or relating to, the disclosure of information in relation to notifiable income tax arrangements.

Part 7 of Finance Act 2004 provides for the notification to the Commissioners of certain tax arrangements and proposals for those arrangements.

Where there has been a failure to fulfill the obligation to notify the Commissioners may seek to impose a penalty. A person who fails to disclose a scheme is liable to an initial penalty of up to a maximum of £5,000. Where after this initial penalty is imposed the failure continues then a further daily penalty of up to a maximum £600 per day will be imposed. Promoters who fail to give a reference number to their client are also liable to a maximum penalty of £5,000.

Initial penalties are determined by the Special Commissioners and there is a right of appeal against the imposition of the penalty. Scheme users who fail to show scheme reference numbers on tax returns are liable to an initial penalty of £100 rising to £500 for a second failure and £1,000 for third and subsequent failures.

Full details of the requirement to disclose details of National Insurance Contribution schemes are available at http://www.hmrc.gov.uk/si/2008-2678-em.pdf