What are the three requirements a foreign institution must meet under section 698 ITTOIA 2005?

Section 698 sets out Requirements A, B and C. Requirement A requires appointing a UK-resident individual or a body with a UK establishment and notifying HMRC. Requirement B requires existing HMRC arrangements for a third party to secure discharge of duties. Requirement C requires other current HMRC arrangements designed to secure duty discharge.

What is Requirement A under section 698 of the Income Tax (Trading and Other Income) Act 2005?

Requirement A has three elements: the foreign institution must appoint a person responsible for ensuring its duties are discharged; that person must be a UK-resident individual or a body with a UK business establishment; and the institution must notify HMRC of the appointed person's identity and the appointment itself.

Can the appointed person be held personally liable under section 698 ITTOIA 2005?

Yes. Investment plan regulations may provide that a person appointed under Requirement A or covered by Requirement B arrangements is personally liable for the institution's failure to comply with its duties. Liability is joint and several, meaning HMRC can pursue either the institution or the appointed person for the full obligation amount.

What additional conditions can investment plan regulations impose under section 698?

Investment plan regulations may restrict who qualifies to meet Requirements A or B by specifying particular descriptions of eligible persons. They may also define circumstances in which appointments or arrangements are treated as terminated, such as when the appointed person ceases to be UK resident, ensuring ongoing compliance with the statutory requirements.

Income Tax (Trading and Other Income) Act 2005 section 698

Requirements for discharge of foreign institution's duties

Section 698 sets out the three requirements (A, B and C) that a foreign institution must satisfy in order to ensure its duties as an individual investment plan manager are properly discharged.

Requirement A requires the institution to appoint a UK-resident individual or a body with a UK business establishment to be responsible for discharging the duties, and to notify HMRC of that person's identity and appointment.
Requirement B requires that current arrangements exist with HMRC for a person other than the institution itself to secure the discharge of the duties.
Requirement C requires that other current arrangements exist with HMRC that are designed to secure the discharge of the duties.
Investment plan regulations may restrict who can fulfil Requirements A or B, specify when appointments or arrangements are treated as terminated, and make the appointed person personally liable—jointly and severally with the institution—for any failure to comply with the duties.

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