Base penalty amount: schemes
284-160 Base penalty amount: schemes
The base penalty amount for a *scheme to which subsection 284‑145(1) or (2C) applies is, subject to section 284‑224:
50% of your *scheme shortfall amount; or
25% of your scheme shortfall amount if it is *reasonably arguable that the adjustment provision does not apply.
The base penalty amount for a *scheme to which subsection 284‑145(2A) applies is, subject to section 284‑224:
25% of your *scheme shortfall amount; or
10% of your scheme shortfall amount if it is *reasonably arguable that the adjustment provision does not apply.
The base penalty amount for a *scheme to which subsection 284‑145(2B) applies is worked out using this table and section 284‑224 if relevant:
Base penalty amount | ||
|---|---|---|
Item | Column 1 In this situation: | Column 2 The base penalty amount is: |
1 | having regard to any relevant matters, it is reasonable to conclude that an entity that (alone or with others) entered into or carried out the *scheme, or part of it, did so with the sole or dominant purpose of that entity or another entity getting a *transfer pricing benefit from the scheme | the sum of: (a) 50% of your *scheme shortfall amount, to the extent that it is not attributable as mentioned in paragraph (b); and (b) 25% of your scheme shortfall amount, to the extent (if any) that it is attributable to the entity, or the entity’s agent, treating the adjustment provision as applying (including not applying) to a matter (or identical matters) in a particular way that is *reasonably arguable |
2 | item 1 does not apply | the sum of: (a) 25% of your *scheme shortfall amount, to the extent that it is not attributable as mentioned in paragraph (b); and (b) 10% of your scheme shortfall amount, to the extent (if any) that it is attributable to the entity, or the entity’s agent, treating the adjustment provision as applying (including not applying) to a matter (or identical matters) in a particular way that is *reasonably arguable |
For special rules about when transfer pricing treatment is not reasonably arguable, see Subdivision 284‑E.
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