Taxes Management Act 1970 section 109D

Penalty for other persons if company fails to comply with section 109B

Section 109D imposes penalties on individuals and companies who cause or contribute to a company leaving UK tax residence before it has met the outstanding tax obligations set out in section 109B.

• A penalty can be imposed on any person who does or is party to acts that cause a company to cease UK residence before conditions A to D in section 109B are satisfied
• The penalty applies to directors of the migrating company, any company controlling it, or directors of that controlling company — and also to anyone (other than a professional adviser acting in that capacity) who directs or instructs those persons to carry out such acts
• The maximum penalty equals the amount of tax payable by the migrating company for periods before it ceased UK residence that remains unpaid at the time of migration
• In penalty proceedings, directors and controlling companies are presumed to have been party to the migrating company's acts and to have known that those acts would lead to early migration, unless they can prove otherwise