(1) A principal to whom a deduction authorisation is issued under section 530D shall deduct tax from the relevant payment concerned only in accordance with the terms of the deduction authorisation.

(2) A principal to whom section 530A applies who makes a relevant payment to a subcontractor in circumstances other than those referred to in subsection (1) shall, without prejudice to section 1078, be liable to a penalty of -

(a) 35 per cent of the relevant payment, where the person to whom the relevant payment was made was a subcontractor who has not had a determination made by the Revenue Commissioners under section 530I,

(b) 20 per cent of the relevant payment, where the person to whom the relevant payment was made was a subcontractor who has had a determination made by the Revenue Commissioners under section 530I and where neither section 530G nor section 530H applies to the subcontractor concerned,