Finance Act 2014 (Theatre Tax Relief)
What this means for your business
- Enforced by
- HMRC
- Applies to
- United Kingdom
- On this page
- 39 compliance obligations, 2 practical guides across 2 topics
What you must do
39 compliance obligations under this legislation — 1 can result in imprisonment.
Management duties 2
Manage follower notices correctly when appealing a final ruling out of time
If you have filed a follower notice about a tax decision and then appeal that decision out of the normal time limit, you must not issue a new follower notice about the original decision until the appeal is either abandoned or a new final ruling is made. When HMRC tells you the appeal outcome, you may need to amend the original notice or let it lapse, depending on the result.
Respond to breach notices to avoid licence suspension or revocation
If you hold a remote gambling operating licence, HMRC can issue a breach notice when you fail to register, meet licence conditions, pay betting duties or provide required security. You must fix the stated breach within the period set in the notice (at least 90 days); otherwise a final notice will follow and your licence can be suspended, revoked or you may need special consent to get a new licence.
Notifications 6
Inform clients and intermediaries if you receive a stop notice
If your business is served with a stop notice for promoting a particular tax arrangement, you must promptly tell every client and any intermediary you know about the arrangement that you are subject to the notice. The notice must explain that the arrangement falls within the stop notice description and include a copy of the stop notice itself. This disclosure must be sent within 5 days of you becoming aware of the stop notice (or of a new intermediary).
Notify clients and publish details of monitoring notice
If HMRC serves you with a monitoring notice, you must tell all your existing clients (and any new clients while the notice is in force) in writing that you are a monitored promoter and which conduct conditions you have breached. After the appeal period ends, you also have to publish the same information online – together with your promoter reference number – if the regulations require it.
Notify clients and relevant parties of your promoter reference number
If your business has been issued a monitoring notice and a promoter reference number, you must tell any existing client, any new client, anyone you know is involved in a tax‑advantaged arrangement, and any relevant intermediary about that number. The notice must be sent within 30 days of the trigger event for each group, ensuring transparency about your promoter status.
Notify HMRC of your current address
If HMRC issues a monitoring notice that applies to you at the end of a tax quarter, you must tell HMRC your up‑to‑date address. You have 30 days after the quarter ends to send the address to an authorised officer. This keeps your tax record correct and avoids potential penalties for late notification.
Notify HMRC when relying on community‑benefit exemption
If your business operates as a bookmaker and you claim that a pool bet is exempt because it is made for community benefit, you must tell HMRC (the Commissioners) about this. The notification must be made in the way and at the time HMRC later specifies.
Pass on promoter reference number to relevant parties
If your business is notified of a promoter reference number under the Theatre Tax Relief scheme, you must share that number with anyone you reasonably expect to be, or become, a client of that promoter, or anyone you have given information about the promoter’s proposal to, within 30 days. You do not need to resend it if you reasonably believe the person already has the number.
Payments and fees 13
Pay 10% betting duty on non‑financial spread bets
If your business is a bookmaker that offers non‑financial spread bets in the UK, you must calculate the profit you make from those bets each accounting period and pay a 10% betting duty to HMRC. If you incur a loss, the duty is treated as zero and the loss can be carried forward to reduce duty on future profits.
Pay 15% general betting duty on Chapter 1 pool bet profits
Unlimited fineIf your business operates Chapter 1 pool betting, you must work out the profit you make from those bets each accounting period and pay HMRC a duty of 15% of that profit. If the calculation shows a loss, you treat the profit as zero and you can carry the loss forward to offset profits in later periods.
Pay 3% betting duty on financial spread bets
If your business acts as a bookmaker in the UK and accepts financial spread bets, you must work out the profit you make from those bets each accounting period and pay a 3% duty on that profit to HMRC. If the calculation gives a loss, treat the duty as zero but you can carry the loss forward to offset future profits.
Pay accelerated tax amount when HMRC issues a notice
If HMRC sends you an accelerated payment notice while a tax enquiry is under way, you must pay the amount shown on the notice within the time limit set out in the notice (usually 90 days, or up to 30 days after HMRC’s determination). The payment counts as an advance on the tax you owe.
Pay any Section 208 penalty within 30 days of HMRC notice
If HMRC decides you owe a penalty under section 208, they will send you a notice that names the tax period. You must pay the full amount of that penalty within 30 days of the notice. Failure to do so can lead to the penalty being treated like a tax assessment and further enforcement action.
Pay excise duty on goods you handle
Unlimited fineIf your business deals with alcohol, tobacco, fuel, or other goods that attract excise duty, you must calculate, pay and declare that duty on time. This section confirms that failure to comply can lead to the same high penalties as other taxes – an unlimited fine and even prison time.
Pay general betting duty (excise tax)
If your business takes bets, you must pay the general betting duty – an excise tax on betting activity – to HMRC. The duty is calculated on your betting turnover and must be paid in line with the Finance Act’s rules. Failure to pay can lead to criminal prosecution.
Pay general betting duty on time
If your business accepts bets (or provides betting facilities) you must calculate the general betting duty for those bets and pay it at the end of each accounting period. The duty is payable by the bookmaker or facility provider, and licence holders, managers or directors can also be held liable if it isn’t paid.
Pay General Betting Duty on your betting profits
If your business operates as a bookmaker and accepts general bets, you must work out your profit for each accounting period and pay a betting duty of 15% of that profit to HMRC. You keep the duty amount if you make a loss (treated as zero) and can carry the loss forward to reduce future duties.
Pay pool betting duty on Chapter 2 pool bets
If you run a bookmaker that offers Chapter 2 pool betting, you must work out the profit you make from those bets each accounting period and pay a duty of 15% of that profit to HMRC. If the calculation gives a loss, treat the profit as zero and you can carry the loss forward to offset future profits.
Pay pool betting duty on Chapter 2 pool bets
If your business operates as a bookmaker and takes Chapter 2 pool bets, you must calculate the pool betting duty on the profit from those bets and pay it when it becomes due at the end of each accounting period. You, any manager of the betting business, anyone who runs the totalisator, and the company’s directors are all jointly liable for any unpaid duty.
Pay remote gaming duty on your profits
If your business provides remote gaming services, you must calculate and pay remote gaming duty on the profits you make each accounting period. For companies, the company and its directors are both responsible for the tax, and the holder of the remote operating licence can also be made to pay. Failure to pay can lead to HMRC taking action against any of these parties.
Provide security for betting or gaming tax liabilities
If HMRC believes you might not pay your betting, pool betting or remote gaming duties, they can send you a notice asking you to provide security (e.g. a bank guarantee or bond). You must supply the amount specified, in the way and by the date set out in the notice (at least 30 days after it is issued). Failure to do so can lead to enforcement action.
Offences and prohibitions 8
Be liable for a body’s theatre‑tax‑relief offence
If a company or partnership commits an offence under section 277A (relating to stop notices) and a director, manager, partner or other senior person either consents to it, turns a blind eye, or is negligent, that person is also guilty of the offence. They can be prosecuted and punished in the same way as the business itself.
Conceal or destroy documents after HMRC informal notice
If HMRC writes to you telling you a document may be needed for a tax notice and you hide, destroy or arrange for it to be hidden or destroyed (or do the same to any other person’s document) before six months have passed or before a formal notice is issued, you commit a criminal offence. Conviction can lead to an unlimited fine and possible imprisonment.
Conceal or destroy documents required by HMRC
If HMRC (by way of a notice under section 255) tells you to produce a document and you hide, destroy, or arrange for the destruction of that document – even after a tribunal has approved the notice – you commit a criminal offence. The offence does not apply if you have already handed the document to a revenue officer and they have not later written to you that it must remain available for inspection.
Corporate officer liable for tax offence
If your company commits a tax offence covered by the Finance Act 2014, any director, general manager, secretary or similar officer who was in post at the time can also be prosecuted as if they committed the offence themselves, unless they had no consent or connivance and exercised all the diligence they should have. They face the same penalties as the company would – typically an unlimited fine and possibly imprisonment.
Fail to comply with information duties under tax‑avoidance‑scheme rules
Fine up to £1,000,000If you are a promoter (or any person) of a tax‑avoidance scheme and you do not fulfil the information, return or notification duties set out in sections such as 236B, 236C, 255‑263, you commit a criminal offence. On conviction you can be fined up to £1 million and may also face daily default penalties for continued non‑compliance. There is no custodial sentence specified in this provision.
Fail to pay betting, pool betting or remote gaming duty
Unlimited fineIf your business is required to pay general betting duty, pool betting duty or remote gaming duty and you do not pay it, you breach the Finance Act. That failure triggers a penalty (including a daily default fine) calculated on the amount of duty owing, and the same daily penalties apply if you breach related gambling regulations listed in the provision.
Fail to provide security or appoint UK representative
Unlimited fineIf your business is required to be registered for theatre tax relief and HMRC tells you to provide security or to appoint a UK representative and you do not do so, you commit a criminal offence. On conviction in the magistrates' court you face an unlimited fine. No imprisonment is provided for this offence.
Fraudulently evade betting or gaming duty
14 years imprisonmentIf you knowingly take steps to avoid paying general betting duty, pool betting duty or remote gaming duty, you commit a criminal offence. On conviction you could face up to 14 years' imprisonment and an unlimited fine, with lower penalties possible in a magistrates' court. HMRC is the enforcing authority.
Reporting and filing 10
Correct tax return and inform HMRC after a follower notice
If HMRC sends you a follower notice and does not withdraw it, you must fix the tax advantage they have denied – either by amending the return/claim or by agreeing in writing to give up the advantage – and then tell HMRC what you have done and how much extra tax is now due. You must do this within the time limits set in the notice or you will face a penalty.
Follow all conditions in any HMRC conduct notice
Unlimited fineIf HMRC gives you a conduct notice, you must comply with every condition it sets out. This can include giving clients and intermediaries clear information about tax‑related proposals, supplying documents to HMRC, and not promoting schemes that create tax advantages through contrived steps. The notice sets the deadline for each condition, so obey it immediately and within the timeframe HMRC specifies.
Provide additional client information when HMRC requests it
If HMRC suspects that you have not supplied all the client details required for a theatre tax relief proposal, they can send you a written notice asking for more information. You must give the prescribed information about any client you could reasonably be expected to know, within 10 days of that notice (or a longer period if HMRC allows). Failure to comply may trigger enforcement action.
Provide client information to HMRC when requested
If HMRC issues you a notice under the monitoring regime, you must supply details of every client you dealt with for each relevant period. This includes the client’s name, address and any other information that HMRC may prescribe, and must be sent within 30 days after the period ends (or as the notice specifies).
Provide client information to HMRC when served with a notice
Unlimited fineIf HMRC serves you with a notice under this section because you act as an intermediary for a monitored proposal, you must send them the name, address and any other prescribed details for each of your clients for the relevant calendar quarters. The information has to be supplied within 30 days of the end of each quarter (or within 30 days of the notice for the initial period).
Provide information in the form HMRC specifies
If HMRC tells you how to give the information or documents they have asked for (for example, a particular format or a specific inspection location), you must follow those instructions. This applies whenever you receive a notice under the Theatre Tax Relief provisions that sets out the required form or place of production.
Provide information to HMRC when notified about a non‑resident promoter
Unlimited fineIf you act as an intermediary, adviser or any other party dealing with a foreign (non‑UK) monitored promoter and HMRC serves you a notice, you must give them the information the promoter failed to supply. You have 10 days from the notice (or a longer period if HMRC tells you) to hand over the requested details.
Provide your NI and tax reference to the promoter
If you have been given a promoter reference number under the Theatre Tax Relief scheme, you must tell the promoter your National Insurance number and Unique Tax Reference (or let them know you have none). You have 10 days to do this from the notification.
Request withdrawal of monitoring notice in writing
If HMRC has issued your business a monitoring notice, you can ask for it to be lifted once at least 12 months have passed since the end of any appeal period. You must send a written request to an authorised officer, who will decide within 30 days whether to end the notice or refuse your request. Keep evidence of your request and of how you have complied with the notice up to that point.
Submit written appeal to HMRC within 30 days of a notice
If HMRC serves you a notice asking for information or documents (under the Theatre Tax Relief rules), you can appeal the notice. You must send a written appeal to the officer who gave the notice within 30 days, stating your grounds, and then follow any tribunal decision within the time it sets.
Penalties for non-compliance
14 penalties under this legislation. 1 can result in imprisonment. 8 carry an unlimited fine.
Fail to comply with information duties under tax‑avoidance‑scheme rules
Fine up to £1,000,000
Fraudulently evade betting or gaming duty
Unlimited fine and/or 14 years imprisonment
Pay 15% general betting duty on Chapter 1 pool bet profits
Unlimited fine
Pay excise duty on goods you handle
Unlimited fine
Fail to pay betting, pool betting or remote gaming duty
Unlimited fine
Fail to provide security or appoint UK representative
Unlimited fine
Follow all conditions in any HMRC conduct notice
Unlimited fine
Provide client information to HMRC when served with a notice
Unlimited fine
Provide information to HMRC when notified about a non‑resident promoter
Unlimited fine
Fail to comply with stop notice duties
Penalty applies
Be liable for a body’s theatre‑tax‑relief offence
Penalty applies
Conceal or destroy documents after HMRC informal notice
Penalty applies
Conceal or destroy documents required by HMRC
Penalty applies
Corporate officer liable for tax offence
Penalty applies
Practical guidance
Our guides explain how to comply with the requirements above.
Claim creative industry tax reliefs
Corporation Tax reliefs for creative businesses - film, high-end TV, animation, video games, theatre, orchestras, and museums - including rates, …
Set up an Employee Ownership Trust
How to sell your business to an Employee Ownership Trust (EOT). Covers CGT relief conditions, structure requirements, the setup process, …
Sections and provisions
374 classified provisions from this legislation.
Duties 39
- Schedule 27 Suspension and revocation of remote operating licences
- s.102 Penalties under section 26 of FA 2003: extension to excise duty
- s.115 Abolition of stamp duty and SDRT: securities on recognised growth markets
- s.125 General betting duty
- s.127 General betting duty charge on general bets
- s.129 General betting duty charge on financial spread bets
- s.130 General betting duty charge on non-financial spread bets
- s.135 General betting duty charge on Chapter 1 pool bets
- s.142 Liability to pay
- s.144 Pool betting duty charge on Chapter 2 pool bets
- s.151 Payment and recovery
- s.152 Notification of reliance on community benefit exemption
- s.162 Liability to pay
- s.170 Security for payment
- s.206 Content of a follower notice
- s.208 Penalty if corrective action not taken in response to follower notice
- s.211 Assessment of a section 208 penalty
- s.216 Late appeal against final judicial ruling
- s.219 Circumstances in which an accelerated payment notice may be given
- s.221 Content of notice given pending an appeal action which is required
- ... and 19 more duties
Offences and penalties 12
- Schedule 35 Promoters of tax avoidance schemes: penalties
- s.173 Offence of failing to provide security or appoint representative
- s.174 Fraudulent evasion
- s.175 Penalties under section 9 of FA 1994
- s.178 Offences by bodies corporate
- s.226 Penalty for failure to pay accelerated payment
- s.274 Penalties
- s.277B Liability for offences under section 277A committed by a body
- s.277A Offences relating to stop notices
- s.278 Offence of concealing etc documents
- s.279 Offence of concealing etc documents following informal notification
- s.280 Penalties for offences
Powers 22
- s.48 Major sporting events: power to provide for tax exemptions
- s.50 Share incentive plans: power to adjust maximum annual awards etc
- s.95 Aggregates levy: power to restore exemptions
- s.108 VAT: prompt payment discounts
- s.163 Administration
- s.164 Registration
- s.166 Returns
- s.167 Payment
- s.168 Information and records
- s.169 Stake funds and gaming prize funds
- s.194 Regulations
- s.195 Notices
- s.204 Circumstances in which a follower notice may be given
- s.210 Reduction of a section 208 penalty for co-operation
- s.232 Extension of this Part by order
- s.236H Publication
- s.240 Amendment , withdrawal or reissue of conduct notice
- s.244A Monitoring notices: transferees
- s.248 Publication by HMRC
- s.255 Power to obtain information and documents
- ... and 2 more powers
Definitions 69
- Schedule 6 Transitional provision relating to new standard lifetime allowance for the tax year 2014-15 etc
- s.30 Avoidance schemes involving the transfer of corporate profits
- Schedule 31 Follower notices and partnerships Partnership follower notice Partnership return
- Schedule 34 Promoters of tax avoidance schemes: threshold conditions appeal period Relevant offence professional body
- s.38 Transfer of deductions: research and development allowances
- s.71 Oil and gas: reinvestment after pre-trading disposal
- s.128 Spread bets
- s.132 Retained winnings profits
- s.133 Bet-brokers betting exchange business
- s.134 Chapter 1 pool bets
- s.138 Profits on retained winnings on Chapter 1 pool bets
- s.139 Chapter 1: stake money
- s.140 Chapter 1: winnings
- s.141 General betting duty charge on betting exchanges
- s.143 Chapter 2 pool bets
- s.147 Profits on retained winnings on Chapter 2 pool bets
- s.149 Chapter 2: winnings
- s.150 Payments treated as bets
- s.153 Bets made for community benefit community society
- s.154 Remote gaming
- ... and 49 more definitions
Exemptions 30
- s.1 Charge, rates, basic rate limit and personal allowance for 2014-15
- s.2 Basic rate limit for 2015-16 and personal allowances from 2015
- s.3 The starting rate for savings and the savings rate limit
- s.8 Annual exempt amount for 2014-15
- s.9 Annual exempt amount for 2015-16 onwards
- Schedule 37 Companies owned by employee-ownership trusts
- s.47 Glasgow Grand Prix
- s.148 Chapter 2: stake money
- s.161 Exemptions
- s.179 Protection of officers
- s.212 Aggregate penalties
- s.214 Appeal against a section 208 penalty
- s.225 Protection of the revenue pending further appeals
- s.227A Group relief claims after accelerated payment notices
- s.237B Duty to give further conduct notice where provisional notice not complied with
- s.237 Duty to give conduct notice
- s.237A Duty to give conduct notice: defeat of promoted arrangements
- s.239A Conduct notices: transferees
- s.242 Monitoring notices: duty to apply to tribunal
- s.243 Monitoring notices: tribunal approval
- ... and 10 more exemptions