The Tax Relief for Social Investments (Accreditation of Social Impact Contractor) Regulations 2014

• Citation: S.I. 2014/3066
• Sections: 11

Section 1 Citation, commencement and interpretation

These Regulations may be cited as the Tax Relief for Social Investments (Accreditation of Social Impact Contractor) Regulations 2014 and come into force on 10th December 2014.

Section 2 Citation, commencement and interpretation

In these Regulations—

“defined outcomes” has the meaning given in regulation 3(1)(b) ,

“ITA 2007” means the Income Tax Act 2007,

“notice” means notice in writing.

Section 3 Criteria for social impact contracts

(1) The criteria that a contract must meet to be a social impact contract are as follows—

(a) a Contracting Authority must be a party to the contract,

(b) the contract must set out the outcomes (“the defined outcomes”) that are intended to be achieved under the contract,

(c) the Secretary of State must be satisfied that the defined outcomes—

(i) have a social or environmental purpose, and

(ii) satisfy the conditions specified in Part 2B (further conditions for defined outcomes) of the Social Investment Tax Relief – Guidance Concerning the Accreditation of Social Impact Contractors published on behalf of the Minister for the Cabinet Office at the time of the application for accreditation,

(d) where services are to be provided under the contract, the contract must distinguish between—

(i) the services to be provided under the contract, and

(ii) the defined outcomes that are intended to be achieved under the contract arising from the provision of those services,

(e) the defined outcomes must be capable of being objectively measured, and the method of measurement must be set out in the contract,

(f) ...the progress towards achieving the defined outcomes must be assessed , on the basis of the method of measurement referred to in paragraph (e), at intervals which the Secretary of State is satisfied are appropriate in relation to the contract, and

(g) at least 60% of the total amount of the payments that could be made under the contract by the Contracting Authority to the company ... must be conditional on achieving defined outcomes which the Secretary of State is satisfied meet the criteria in paragraphs (c) and (e) above.

(2) For the purposes of this regulation—

(a) “Contracting Authority” has the meaning given by regulation 2(1) of the Public Contracts Regulations 2015 ,

(b) a “social or environmental purpose” means one or more of the following purposes—

(i) the relief of those in need by reason of youth, age, ill-health, disability, financial hardship or other disadvantage,

(ii) the relief or prevention of poverty,

(iii) the promotion of employment, culture, heritage or sport,

(iv) the advancement of training and education,

(v) the prevention and reduction of crime,

(vi) environmental protection,

(vii) the provision of social housing and the relief of homelessness,

(viii) the provision of community facilities,

(ix) the promotion of social inclusion and cohesion,

(x) the advancement of citizenship or community development,

(xi) the improvement of physical and mental health,

(xii) the provision of long-term care in relation to any infirmity, or

(xiii) any other areas that may reasonably be regarded as analogous to any areas falling within any of paragraphs (i) to (xii).

Section 4 Notification of accreditation or refusal

The Secretary of State must give notice to a company of the grant of an accreditation specifying—

(a) the date of the grant of accreditation,

(b) the date on which the period of accreditation begins,

(c) the requirements of accreditation (if any) to be imposed by virtue of section 257JF(1)(b) of ITA 2007, and

(d) the length of the period of accreditation or how the length is to be determined.

Section 5 Notification of accreditation or refusal

The Secretary of State must give notice to a company of a refusal to grant an accreditation specifying—

(a) the date of the refusal, and

(b) the reasons for the refusal.

Section 6 Publication of information

The Secretary of State may publish from time to time the following information in relation to any accredited social impact contractor—

(a) the name of the accredited social impact contractor,

(b) the business address of the accredited social impact contractor,

(c) the date the accredited social impact contractor was granted accreditation,

(d) the length of the period of accreditation, and

(e) an outline of—

(i) the defined outcomes, and

(ii) the services provided, or to be provided, by the contractor in respect of each social impact contract to which the contractor is, or was, a party.

Section 7 Requirements of accreditation

(1) A social impact contractor must comply with the matters in paragraphs (2) and (3) as conditions of its accreditation.

(2) The social impact contractor must ensure that there is no period during the period of its accreditation when it is not a party to at least one social impact contract.

(3) The social impact contractor—

(a) must give notice to the Secretary of State within 30 days of—

(i) any material change in respect of each social impact contract to which it is a party, including the termination of, or an alteration of the defined outcomes set out in, the contract, or

(ii) any change of its name or business address, and

(b) must provide a relevant report to the Secretary of State in respect of—

(i) each period of 12 months since the date of accreditation, within one month of the end of each such period, and

(ii) such other period and by such date after the expiry of that period as the Secretary of State may by notice reasonably require.

(4) In paragraph (3), “relevant report” means a report setting out such information as the Secretary of State may by notice specify concerning the performance of the social impact contractor under each social impact contract to which it was a party during the period to which the report relates.

Section 7A Provision of information

(1) The Secretary of State may give notice to an accredited social impact contractor to require that person to provide such information as is specified in the notice.

(2) The information which may be included in the notice is information which the Secretary of State believes is reasonably required in connection with the discharge of the Secretary of State’s functions under section 257JD or 257JG of ITA 2007.

(3) A notice under paragraph (1) must include the date by which the information must be provided, being a date no earlier than 14 days after the date on which the notice is given.

(4) It is a condition of an accreditation that an accredited social impact contractor must comply with a notice given to it under paragraph (1).

Section 8 Notification of changes to contract and breach of conditions for approval

(1) The social impact contractor must as soon as reasonably possible give notice to the Secretary of State where it fails to comply, or it is likely to fail to comply, with—

(a) any requirement of accreditation imposed—

(i) by virtue of section 257JF(1)(b) of ITA 2007, or

(ii) by or under these regulations, or

(b) a condition in section 257JD(3)(b) or (c) of ITA 2007.

(2) A notice required under paragraph (1) must—

(a) specify the circumstances that caused, or are likely to cause, the requirement or condition to cease to be met, or not to be met,

(b) so far as possible, state the extent to which the requirement or condition has ceased or will cease to be met, or has not been met, and

(c) where the company considers that the requirement or condition is likely to cease to be met or not to be met by or on a date occurring after the date of the notice, specify (if possible) that future date.

(3) If a notice has been given in respect of circumstances that are likely to cause any requirement or condition to cease to be met or not to be met, no further notice under paragraph (1) is required in relation to those circumstances if any requirement or condition ceases to be met or is not met in, or as a result of, those circumstances.

Section 9 Withdrawal of accreditation

(1) The Secretary of State may withdraw an accreditation where there is a failure to comply with any requirement of an accreditation.

(2) A withdrawal of an accreditation must be given by notice to the company which is or has been an accredited social impact contractor by the Secretary of State specifying the date from which accreditation is withdrawn (which may be the date of the failure or a later date) and the reasons for the withdrawal.

(3) The company must within 30 days of receiving notice under paragraph (2) of withdrawal of accreditation give notice to each of the investors to which it has issued a compliance certificate in respect of investments made within the specified period stating that accreditation has been or will be withdrawn and specifying the date from which accreditation is withdrawn.

(4) For the purpose of paragraph (3), “specified period” means the three years immediately preceding the date from which accreditation is withdrawn.

Section 10 Appeals against refusal to grant accreditation or withdrawal of accreditation

(1) An appeal to the tribunal may be brought by a company against—

(a) a refusal to grant an accreditation,

(b) the imposition of a requirement under section 257JF(1)(b) of ITA 2007,

(c) the withdrawal of an accreditation (whether under section 257JD(4) of ITA 2007 or under regulation 9).

(2) Notice of an appeal under this regulation must be given to the Secretary of State within 30 days of the date of the notice of—

(a) the refusal,

(b) the imposition of a requirement, or

(c) the withdrawal.

(3) The notice of appeal must specify the grounds of appeal.

(4) If the tribunal, on an appeal made to it, allows the appeal, it may—

(a) in an appeal against a refusal to grant accreditation, direct that the Secretary of State accredit the company within 14 days of its decision,

(b) in an appeal against the imposition of a requirement under section 257JF(1)(b), direct that the Secretary of State reconsider the decision to impose the requirement, or

(c) in an appeal against a withdrawal of accreditation, direct that the withdrawal was ineffective.