SCHEDULES

SCHEDULE 18Serial tax avoidance

PART 4Restriction of reliefs

The restricted period

21

1

In paragraphs 19 and 20 (and this paragraph) “the restricted period” means the period of 3 years beginning with the day on which the relief restriction notice is given.

2

If during the restricted period (or the restricted period as extended under this sub-paragraph) the person to whom a relief restriction notice has been given incurs a further relevant defeat meeting the conditions in sub-paragraph (4), HMRC must give the person a written notice (a “restricted period extension notice”).

3

A restricted period extension notice extends the restricted period to the end of the period of 3 years beginning with the day on which the further relevant defeat occurs.

4

The conditions mentioned in sub-paragraph (2) are that—

a

the relevant defeat is incurred by virtue of Condition A, B or C in relation to arrangements which the person used in the warning period mentioned in paragraph 19(1)(a), and

b

the warning notice given to the person in respect of the relevant defeat relates to the misuse of a relief.

5

If the person to whom a relief restriction notice has been given incurs a relevant defeat which meets the conditions in sub-paragraph (4) after the restricted period has expired but before the end of a concurrent warning period, HMRC must give the person a restriction of relief notice.

6

In sub-paragraph (5) “concurrent warning period” means a warning period which at some time ran concurrently with the restricted period.