High risk tax avoidance schemes
HMRC have published a new consultation document entitled ‘High risk tax avoidance schemes’. The consultation concerns proposals intended to remove the cash flow benefits from those who use certain listed high risk tax avoidance schemes.
The proposals are aimed at the promoters and users of high risk tax avoidance schemes defined by HMRC as a scheme that uses contrived arrangements to seek tax advantages in circumstances where they are not intended to be available and which HMRC believes does not deliver the advertised tax advantages. The schemes would be listed in regulations and only affect the promoters and users of the listed schemes.
Users of a listed scheme would be required to disclose the use to HMRC and would be subject to an additional charge on amounts that are underpaid hence removing the cash flow benefits of using the scheme in the first place.
The closing date for comments is 31 August 2011.