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ACCA Applied Skills · Taxation (UK) · Principal sources of revenue law and practice

Which of the following best describes the role of the Finance Act in UK tax law?

The Finance Act is an annual Act of Parliament that gives legal effect to the Chancellor's Budget tax proposals by amending tax legislation. It is not HMRC guidance, a record of tribunal decisions, or an extra-statutory concession.

  1. AIt is passed each year to enact the Chancellor's Budget tax proposals into lawCorrect
  2. BIt sets out HMRC's internal practice for compliance checks
  3. CIt records the decisions of the tax tribunals
  4. DIt is an extra-statutory concession published by HMRC

Explanation

A Finance Act is statute passed annually to give legal effect to the Budget proposals, amending existing tax legislation. Compliance practice is in HMRC guidance, not the Act. Tribunal decisions form case law. Extra-statutory concessions are HMRC publications, not Acts.

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