UK and International Tax news
Tax Avoidance Condoc
Wednesday 25th July 2012
HMRC have recently published a consultation document ‘Lifting the Lid on Tax Avoidance Schemes’ which aims to introduce measures to improve the information available about tax avoidance schemes and the risks of using them, together with proposals to revise and extend the DOTAS regime.
In particular, the condoc requests comments on whether proposals to revise and extend the DOTAS ‘hallmarks’ (the descriptions of schemes required to be disclosed for income tax, capital gains tax and corporation tax purposes) are too widely or narrowly drawn, and on their impacts upon compliance costs and administrative burdens.
Potential new measures include:
Extending the information disclosed to HMRC about discloseable avoidance schemes;
Extending the information reported to HMRC about users and other parties involved in a discloseable avoidance scheme;
Raising the threshold of ‘reasonable excuse’ for a promoter who fails to notify a discloseable scheme;
Imposing additional reporting obligations on a promoter who incurs a penalty for failure to disclose a scheme; and
Imposing a personal responsibility on an individual, to sit alongside the firm’s obligations, to comply with a promoter’s DOTAS obligations.
Proposed revisions to existing hallmarks include:
Amending the ‘confidentiality where promoter involved’ hallmark to remove inconsistencies in the interpretations being applied by promoters to the hallmark;
Amending the ‘confidentiality where no promoter involved’ hallmark to cover instances where the firm designing the scheme for use in-house is also a promoter who is capable of selling the scheme to clients; and
Amending the ‘loss scheme’ hallmark to ensure that marketed loss schemes are discloseable, and extending the hallmark (currently limited to schemes intended for individuals) to schemes for corporate users.
HMRC are also proposing two new hallmarks, one that targets schemes seeking to circumvent the disguised remuneration rules concerning employment income provided via intermediaries; and one that targets schemes which rely on certain financial products.
If you would like further details on the condoc, please contact Keith Rushen on 0044 (0)20 7486 2378.Contact Us