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Section 7 Notice of liability to income tax and capital gains tax.F1C1C2C3C4

United Kingdom

Changes not yet applied. Later legislation changes this provision in ways not yet written into the text below:

(1)

Every person who—

(a)

is chargeable to income tax or capital gains tax for any year of assessment, and

(F2b)

falls within subsection (1A) or (1B),

shall, subject to subsection (3) below, within F3the notification period, give notice to an officer of the Board that he is so chargeable.

(F41A)

A person falls within this subsection if the person has not received a notice under section 8 requiring a return for the year of assessment of the person's total income and chargeable gains.

(1B)

A person falls within this subsection if the person—

(a)

has received a notice under section 8 requiring a return for the year of assessment of the person's total income and chargeable gains, and

(b)

has received a notice under section 8B withdrawing the notice under section 8.

(1C)

In subsection (1) “the notification period” means—

(a)

in the case of a person who falls within subsection (1A), the period of 6 months from the end of the year of assessment, or

(b)

in the case of a person who falls within subsection (1B)—

(i)

the period of 6 months from the end of the year of assessment, or

(ii)

the period of 30 days beginning with the day after the day on which the notice under section 8 was withdrawn,

whichever ends later.

(2)

In the case of F5persons who are chargeable as mentioned in subsection (1) above as F6the relevant trustees of a settlement, that subsection F7and subsections (1A) to (1C) have effect as if references to a notice under section 8 were references to a notice under section 8A.

(F82A)

A person who—

(a)

falls within subsection (1A) or (1B), and

(b)

is notified of a simple assessment for the year of assessment,

is not required to give notice under subsection (1) for that year unless the person is chargeable to F9an amount of income tax or capital gains tax for the year of assessment F10... that is not included in the assessment.

(3)

A person shall not be required to give notice under subsection (1) above in respect of a year of assessment if for that yearF11—

(a)

the person's total income consists of income from sources falling within subsections (4) to (7) below,

(b)

the person has no chargeable gains, and

(c)

the person is not liable to F12an amount of tax under any provision listed in relation to the person in section 30 of ITA 2007 (additional tax) F13other than Chapter 9 of Part 10 of ITEPA 2003 (winter fuel payment charge).

(4)

A source of income falls within this subsection in relation to a year of assessment if—

(a)

all payments of, or on account of, income from it during that year, and

(b)

all income from it for that year which does not consist of payments,

have or has been taken into account in the making of deductions or repayments of tax under F14PAYE regulations.

(5)

A source of income falls within this subsection in relation to any person and any year of assessment if all income from it for that year has been or will be taken into account—

(a)

in determining that person’s liability to tax, or

(b)

in the making of deductions or repayments of tax under PAYE regulations.

(6)

A source of income falls within this subsection in relation to any person and any year of assessment if all income from it for that year is—

(a)

income from which income tax has been deducted; F15or

(b)

income from or on which income tax is treated as having been deducted or paidF16,

F17(c)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

and that person is not for that year liable to tax at a rate other than the basic rateF18, F19the property basic rate, the savings basic rate, the dividend nil rate F20, F21the Scottish basic rate, F22a Scottish rate below the Scottish basic rate, the Scottish intermediate rate, F23the Welsh basic rate, F24the Welsh property basic rate, the F25dividend ordinary rate F26, the savings nil rate F27or the starting rate for savings.

(F286ZA)

A source of income falls within this subsection in relation to any person and any year of assessment if for that year—

(a)

all income from the source is savings income (see section 18 of ITA 2007), and

(b)

the person—

(i)

is UK resident,

(ii)

is not liable to tax at the savings basic rate,

(iii)

is not liable to tax at the savings higher rate,

(iv)

is not liable to tax at the savings additional rate, and

(v)

is not charged to tax under section 832 of ITTOIA 2005 (relevant foreign income charged on remittance basis) on any savings income.

(F296A)

A source of income falls within this subsection in relation to any person and any year of assessment if for that year—

(a)

all income from the source is dividend income (see section 19 of ITA 2007), and

(b)

the person—

(i)

is UK-resident,

(ii)

is not liable to tax at the dividend ordinary rate,

(iii)

is not liable to tax at the dividend upper rate,

(iv)

is not liable to tax at the dividend additional rate, and

(v)

is not charged to tax under section 832 of ITTOIA 2005 (relevant foreign income charged on remittance basis) on any dividend income.

(7)

A source of income falls within this subsection in relation to any person and any year of assessment if all income from it for that year is F30income on which he could not become liable to tax under a self-assessment made under section 9 of this Act in respect of that year.

F31(8)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(F329)

For the purposes of this Act the relevant trustees of a settlement are—

(a)

in relation to income F33(other than gains treated as arising under F34Chapter 9 of Part 4 of ITTOIA 2005), the persons who are trustees when the income arises and any persons who subsequently become trustees; and

(F35aa)

in relation to gains treated as arising under F36Chapter 9 of Part 4 of ITTOIA 2005, the persons who are trustees in the year of assessment in which the gains arise and any persons who subsequently become trustees; and

(b)

in relation to chargeable gains, the persons who are trustees in the year of assessment in which the chargeable gains accrue and any persons who subsequently become trustees.

Annotations

Textual amendments

F1

S. 7 substituted (with effect as respects the year 1995-96 and subsequent years of assessment) by Finance Act 1994 (c. 9), s. 199(2)(3), Sch. 19 para. 1(1)(2); S.I. 1998/3173, art. 2

F2

S. 7(1)(b) substituted (with effect in accordance with Sch. 51 para. 9 of the amending Act) by Finance Act 2013 (c. 29), Sch. 51 para. 2(2)(a)

F3

Words in s. 7(1) substituted (with effect in accordance with Sch. 51 para. 9 of the amending Act) by Finance Act 2013 (c. 29), Sch. 51 para. 2(2)(b)

F4

S. 7(1A)-(1C) inserted (with effect in accordance with Sch. 51 para. 9 of the amending Act) by Finance Act 2013 (c. 29), Sch. 51 para. 2(3)

F5

Words in s. 7(2) substituted (with effect in accordance with s. 103(7) of the amending Act) by Finance Act 1995 (c. 4), s. 103(1)(a)

F6

Words in s. 7(2) substituted (with effect in accordance with s. 103(7) of the amending Act) by Finance Act 1995 (c. 4), s. 103(1)(b)

F7

Words in s. 7(2) substituted (with effect in accordance with Sch. 51 para. 9 of the amending Act) by Finance Act 2013 (c. 29), Sch. 51 para. 2(4)

F8

S. 7(2A) inserted (with effect in accordance with s. 167(2) of the amending Act) by Finance Act 2016 (c. 24), Sch. 23 para. 2

F9

Words in s. 7(2A) inserted (with effect in accordance with s. 98(5) of the amending Act) by Finance Act 2022 (c. 3), s. 98(2)(a)

F10

Words in s. 7(2A) omitted (with effect in accordance with s. 98(5) of the amending Act) by virtue of Finance Act 2022 (c. 3), s. 98(2)(b)

F11

Words in s. 7(3) substituted (with effect in accordance with Sch. 1 para. 7 of the amending Act) by Finance Act 2012 (c. 14), Sch. 1 para. 2

F12

Words in s. 7(3)(c) substituted (with effect in accordance with s. 98(5) of the amending Act) by Finance Act 2022 (c. 3), s. 98(3)

F13

Words in s. 7(3)(c) inserted (for the tax year 2025-26 and subsequent tax years) by Finance Act 2026 (c. 11), Sch. 10 paras. 2, 5

F14

Words in s. 7(4)(5) substituted (with effect in accordance with s. 723(1)(a)(b) of the amending Act) by Income Tax (Earnings and Pensions) Act 2003 (c. 1), Sch. 6 para. 124 (with Sch. 7)

F15

Word in s. 7(6) inserted (with effect in accordance with s. 5(10) of the amending Act) by Finance Act 2016 (c. 24), s. 5(9)(a)(i)

F16

Comma in s. 7(6)(b) substituted (with effect in accordance with s. 5(10) of the amending Act) by Finance Act 2016 (c. 24), s. 5(9)(a)(ii)

F17

S. 7(6)(c) omitted (with effect in accordance with s. 5(10) of the amending Act) by virtue of Finance Act 2016 (c. 24), s. 5(9)(a)(iii)

F18

Words in s. 7(6) inserted (with effect in accordance with s. 5(10) of the amending Act) by Finance Act 2016 (c. 24), s. 5(9)(a)(iv)

F19

Words in s. 7(6) inserted (for the tax year 2027-28 and subsequent tax years) by Finance Act 2026 (c. 11), s. 6(8), Sch. 1 para. 37(a)(i)

F20

Words in s. 7(6) inserted (with effect for the year 1999-00 and subsequent years of assessment) by Finance (No. 2) Act 1997 (c. 58), Sch. 4 para. 1(1)(2)

F21

Words in s. 7(6) inserted (with effect in accordance with Sch. 38 para. 14(2) of the amending Act) by Finance Act 2014 (c. 26), Sch. 38 para. 14(1)

F22

Words in s. 7(6) inserted (6.4.2018) by The Scottish Rates of Income Tax (Consequential Amendments) Order 2018 (S.I. 2018/459), arts. 1(2), 2(2)

F23

Words in s. 7(6) inserted (24.7.2018) by Wales Act 2014 (c. 29), ss. 9(12), 14, 29(4); S.I. 2018/892, art. 3 (with arts. 5, 6, 8)

F24

Words in s. 7(6) inserted (for the tax year 2027-28 and subsequent tax years) by Finance Act 2026 (c. 11), s. 6(8), Sch. 1 para. 37(a)(ii)

F25

Word in s. 7(6) substituted (with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 358(2)(b) (with Sch. 2)

F26

Words in s. 7(6) inserted (with effect in accordance with s. 4(17) of the amending Act) by Finance Act 2016 (c. 24), s. 4(15)

F27

Words in s. 7(6) substituted (with effect in accordance with Sch. 1 para. 65 of the amending Act) by Finance Act 2008 (c. 9), Sch. 1 para. 38

F28

S. 7(6ZA) inserted (for the tax year 2027-28 and subsequent tax years) by Finance Act 2026 (c. 11), s. 6(8), Sch. 1 para. 37(b)

F29

S. 7(6A) inserted (with effect in accordance with s. 5(10) of the amending Act) by Finance Act 2016 (c. 24), s. 5(9)(b)

F30

Words in s. 7(7) substituted (with effect in accordance with s. 103(7) of the amending Act) by Finance Act 1995 (c. 4), s. 115(1)

F31

S. 7(8) omitted (with effect in accordance with art. 3 of the amending S.I.) by virtue of Finance Act 2008 (c. 9), s. 123(2), Sch. 41 para. 25(a)(i); S.I. 2009/511, art. 2 (with art. 4)

F32

S. 7(9) inserted (with effect in accordance with s. 103(7) of the amending Act) by Finance Act 1995 (c. 4), s. 103(2)

F33

Words in s. 7(9)(a) inserted (with effect in accordance with Sch. 14 para. 7(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 14 para. 5(a)

F34

Words in s. 7(9)(a) substituted (with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 358(3) (with Sch. 2)

F35

S. 7(9)(aa) inserted (with effect in accordance with Sch. 14 para. 7(5) of the amending Act) by Finance Act 1998 (c. 36), Sch. 14 para. 5(b)

F36

Words in s. 7(9)(aa) substituted (with effect in accordance with s. 883(1) of the amending Act) by Income Tax (Trading and Other Income) Act 2005 (c. 5), s. 883(1), Sch. 1 para. 358(3) (with Sch. 2)

Modifications

C1

S. 7 modified (as respects the year 1995-96) by Finance Act 1995 (c. 4), Sch. 21 para. 1

C2

S. 7 modified (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), ss. 137(5)(7), 381(1) (with Sch. 9 paras. 1-9, 22)

C3

S. 7 modified (with effect in accordance with s. 381(1) of the amending Act) by Taxation (International and Other Provisions) Act 2010 (c. 8), ss. 140(6)(7), 381(1) (with Sch. 9 paras. 1-9, 22)

C4

S. 7 applied (with modifications) (22.7.2020) by Finance Act 2020 (c. 14), Sch. 16 para. 12(1)-(5) (as amended (with effect in accordance with s. 98(5) of the amending Act) by Finance Act 2022 (c. 3), s. 98(4))

Notes on Part II

Modifications

C1

Pt. 2 applied (with modifications) by Social Security Contributions and Benefits (Northern Ireland) Act 1992 (c. 7), s. 11A(1)(3) (as inserted (with effect in accordance with Sch. 1 para. 35 of the amending Act) by National Insurance Contributions Act 2015 (c. 5), Sch. 1 para. 12)

C2

Pt. 2 applied (with modifications) by Social Security Contributions and Benefits Act 1992 (c. 4), s. 11A(1)(3) (as inserted (with effect in accordance with Sch. 1 para. 35 of the amending Act) by National Insurance Contributions Act 2015 (c. 5), Sch. 1 para. 3)

C3

Pt. 2 modified (14.9.2023) by The Public Service Pension Schemes (Rectification of Unlawful Discrimination) (Tax) (No. 2) Regulations 2023 (S.I. 2023/912), regs. 1(2), 41(1) (with reg. 1(3))

C4

Pt. 2 applied (with modifications) (6.4.2024 immediately after the coming into force of 2023 c. 57, Sch. para. 4(1)(2)) by 1992 c. 7, s. 11A (as inserted by The Social Security (Class 2 National Insurance Contributions) (Consequential Amendments and Savings) Regulations 2024 (S.I. 2024/377), regs. 1(2), 10 (with reg. 1(4)))

C5

Pt. 2 applied (with modifications) (6.4.2024 immediately after the coming into force of 2023 c. 57, Sch. para. 4(1)(2)) by 1992 c. 4, s. 11A (as inserted by The Social Security (Class 2 National Insurance Contributions) (Consequential Amendments and Savings) Regulations 2024 (S.I. 2024/377), regs. 1(2), 9 (with reg. 1(4)))