§ 36 — Surcharge for failure to register

36.—(1) This section applies where the ultimate parent entity of an MNE group to which this Act applies for a financial year, fails to register the MNE group in accordance with section 31.(2) The Comptroller may make an assessment of a surcharge on the ultimate parent entity of an amount equal to 10% of the total of the MTT and the DTT assessed under section 50.

(3) Sections 49(5) to (8), 52, 53, 54(1) to (4), 55, 56 and 57 apply in relation to an assessment in subsection (2), as they apply in relation to an assessment in those provisions, with the necessary modifications and the following other modifications:(a)

a reference to MTT or DTT is to the surcharge assessed under subsection (2);

(b)

a reference to the chargeable entity is to the ultimate parent entity;

(c)

such other modifications as may be prescribed by the regulations.

(4) Sections 78(9) to (15) (including regulations made under section 78(16)), 79, 80, 80A, 80B and 83 of the ITA apply in relation to an appeal under section 54 (as applied by subsection (3)) as they apply in relation to an appeal under Part 18 of the ITA, with the modifications under subsection (5) and all other necessary modifications.

(5) The modifications are —(a)

all references to or in relation to unabsorbed allowances, losses or donations are omitted;

(b)

a reference to an assessment is to an assessment under subsection (2);

(c)

a reference to tax is to the surcharge;

(d)

the reference to section 78(14) of the ITA in section 80A(3) of the ITA is to that provision as applied by subsection (4); and

(e)

such other modifications as may be prescribed by the regulations.

(6) Sections 57, 87, 89 and 90 of the ITA apply for the purposes of collecting and recovering —(a)

an amount of surcharge assessed under subsection (2) and not paid on the date in section 49(7) (as applied by subsection (3)) (called in this section surcharge in arrears); and

(b)

an amount of interest imposed under section 49(8) (as applied by subsection (3)) (called in this section the interest in arrears),

as they apply for the purposes of collecting and recovering an amount of unpaid ITA tax, and any unpaid interest imposed under section 85(2) of that Act, subject to the modifications in subsection (7) and all other necessary modifications.

(7) The modifications are —(a)

a reference to tax or tax charged on the income of a person, is to the surcharge in arrears, including (in the case of section 57 of the ITA) any penalty imposed by section 87 of the ITA as applied by subsection (6);

(b)

a reference to interest imposed under section 85(2) of the ITA is to the interest in arrears;

(c)

a reference to the person assessed to tax, the person by whom tax is payable, the person from whom an amount of tax is due, the defaulting taxpayer or a person liable to any tax, interest or penalty, is to the ultimate parent entity;

(d)

a reference in section 57 of the ITA to Part 18 of the ITA is to the provisions of Part 18 of the ITA as applied by subsection (6);

(e)

a reference to any provision of the ITA relating to the collection and recovery of tax is to that provision as applied by subsection (6);

(f)

a reference to the periods prescribed for the payment of tax under section 85 of the ITA is to the time specified for the payment of the surcharge in section 49(7) (as applied by subsection (3));

(g)

a reference to penalty or additional penalty is to the penalty or additional penalty imposed by section 87(1)(a) or (c) (as the case may be) of the ITA as applied by subsection (6); and

(h)

such other modifications as may be prescribed by the regulations.

(8) The Comptroller may, for good cause, remit wholly or in part any surcharge or interest payable under this section.

(9) If, upon an objection made under section 53 or an appeal lodged under section 54, an assessment made under section 50 is varied or annulled, then the surcharge is correspondingly increased, reduced or annulled (as the case may be), and —(a)

if the surcharge is increased, subsections (3) to (8) apply to the increased amount of the surcharge as they apply to the surcharge; or

(b)

if the surcharge is reduced or annulled and it has already been paid to the Comptroller, the amount of the reduction or the entire amount (including any interest paid on the amount) must be refunded.

(10) If, upon an objection made under section 53 (as applied by subsection (3)) or an appeal lodged under section 54 (as applied by subsection (3)), an assessment made under section 50 is varied or annulled, the surcharge is correspondingly increased, reduced or annulled (as the case may be), then —(a)

if the surcharge is increased, subsections (3) to (8) apply to the increased amount of the surcharge as they apply to the surcharge; or

(b)

if the surcharge is reduced or annulled and it has already been paid to the Comptroller, the amount of the reduction or the entire amount (including any interest paid on the amount) must be refunded.

—(1) This section applies where the ultimate parent entity of an MNE group to which this Act applies for a financial year, fails to register the MNE group in accordance with section 31.

(2) The Comptroller may make an assessment of a surcharge on the ultimate parent entity of an amount equal to 10% of the total of the MTT and the DTT assessed under section 50.

(3) Sections 49(5) to (8), 52, 53, 54(1) to (4), 55, 56 and 57 apply in relation to an assessment in subsection (2), as they apply in relation to an assessment in those provisions, with the necessary modifications and the following other modifications:(a)

a reference to MTT or DTT is to the surcharge assessed under subsection (2);

(b)

a reference to the chargeable entity is to the ultimate parent entity;

(c)

such other modifications as may be prescribed by the regulations.

(4) Sections 78(9) to (15) (including regulations made under section 78(16)), 79, 80, 80A, 80B and 83 of the ITA apply in relation to an appeal under section 54 (as applied by subsection (3)) as they apply in relation to an appeal under Part 18 of the ITA, with the modifications under subsection (5) and all other necessary modifications.

(5) The modifications are —(a)

all references to or in relation to unabsorbed allowances, losses or donations are omitted;

(b)

a reference to an assessment is to an assessment under subsection (2);

(c)

a reference to tax is to the surcharge;

(d)

the reference to section 78(14) of the ITA in section 80A(3) of the ITA is to that provision as applied by subsection (4); and

(e)

such other modifications as may be prescribed by the regulations.

(6) Sections 57, 87, 89 and 90 of the ITA apply for the purposes of collecting and recovering —(a)

an amount of surcharge assessed under subsection (2) and not paid on the date in section 49(7) (as applied by subsection (3)) (called in this section surcharge in arrears); and

(b)

an amount of interest imposed under section 49(8) (as applied by subsection (3)) (called in this section the interest in arrears),

as they apply for the purposes of collecting and recovering an amount of unpaid ITA tax, and any unpaid interest imposed under section 85(2) of that Act, subject to the modifications in subsection (7) and all other necessary modifications.

(7) The modifications are —(a)

a reference to tax or tax charged on the income of a person, is to the surcharge in arrears, including (in the case of section 57 of the ITA) any penalty imposed by section 87 of the ITA as applied by subsection (6);

(b)

a reference to interest imposed under section 85(2) of the ITA is to the interest in arrears;

(c)

a reference to the person assessed to tax, the person by whom tax is payable, the person from whom an amount of tax is due, the defaulting taxpayer or a person liable to any tax, interest or penalty, is to the ultimate parent entity;

(d)

a reference in section 57 of the ITA to Part 18 of the ITA is to the provisions of Part 18 of the ITA as applied by subsection (6);

(e)

a reference to any provision of the ITA relating to the collection and recovery of tax is to that provision as applied by subsection (6);

(f)

a reference to the periods prescribed for the payment of tax under section 85 of the ITA is to the time specified for the payment of the surcharge in section 49(7) (as applied by subsection (3));

(g)

a reference to penalty or additional penalty is to the penalty or additional penalty imposed by section 87(1)(a) or (c) (as the case may be) of the ITA as applied by subsection (6); and

(h)

such other modifications as may be prescribed by the regulations.

(8) The Comptroller may, for good cause, remit wholly or in part any surcharge or interest payable under this section.

(9) If, upon an objection made under section 53 or an appeal lodged under section 54, an assessment made under section 50 is varied or annulled, then the surcharge is correspondingly increased, reduced or annulled (as the case may be), and —(a)

if the surcharge is increased, subsections (3) to (8) apply to the increased amount of the surcharge as they apply to the surcharge; or

(b)

if the surcharge is reduced or annulled and it has already been paid to the Comptroller, the amount of the reduction or the entire amount (including any interest paid on the amount) must be refunded.

(10) If, upon an objection made under section 53 (as applied by subsection (3)) or an appeal lodged under section 54 (as applied by subsection (3)), an assessment made under section 50 is varied or annulled, the surcharge is correspondingly increased, reduced or annulled (as the case may be), then —(a)

if the surcharge is increased, subsections (3) to (8) apply to the increased amount of the surcharge as they apply to the surcharge; or

(b)

if the surcharge is reduced or annulled and it has already been paid to the Comptroller, the amount of the reduction or the entire amount (including any interest paid on the amount) must be refunded.