Paragraph 11

Paragraph 6A (categorisation of failures) is amended as follows.

For sub-paragraph (1) substitute—

“(A1)

A failure is in category 0 if—

(a)

it involves a domestic matter,

(b)

it involves an offshore matter or an offshore transfer, the territory in question is a category 0 territory and the tax at stake is income tax or capital gains tax, or

(c)

it involves an offshore matter and the tax at stake is a tax other than income tax or capital gains tax.

(1)

A failure is in category 1 if—

(a)

it involves an offshore matter or an offshore transfer,

(b)

the territory in question is a category 1 territory, and

(c)

the tax at stake is income tax or capital gains tax.”

In sub-paragraph (2)(a), after “matter” insert “ or an offshore transfer ”.

In sub-paragraph (3)(a), after “matter” insert “ or an offshore transfer ”.

After sub-paragraph (4) insert—

“(4A)

A failure “involves an offshore transfer” if—

(a)

it does not involve an offshore matter,

(b)

it is deliberate (whether or not concealed) and results in a potential loss of revenue,

(c)

the tax at stake is income tax or capital gains tax, and

(d)

the applicable condition in paragraph 6AA is satisfied.”

In sub-paragraph (5), for the words following “revenue” substitute “ and does not involve either an offshore matter or an offshore transfer ”.

In sub-paragraph (6)(a), after “matters” insert “ or transfers ”.

Omit sub-paragraph (8).

In sub-paragraph (9), after “paragraph” insert “ and paragraph 6AA ”.