TaxCorporate TaxTaxman to offer clearance procedures

Taxman to offer clearance procedures

Varney review will offer advance clearance in charm offensive by government

The government has announced new tax clearance arrangements for business with
the publication of the
Varney
review
.

The Treasury and HM Revenue & Customs outlined the proposals today,
conceding advanced agreements on tax, which will be given within 28 days.

The move was widely welcomed. Paul Eagland, head of tax at BDO Stoy Hayward,
said: ‘The Varney review, if successful, could be one of Gordon Brown’s
brightest legacies, ranking alongside awarding independence to the Bank of
England. Improving co-operation and understanding between business and HMRC has
been needed for some time, and will benefit UK business as well as helping
attracting foreign investment.’

Business has long lobbied for the move.

Chris Sanger, Ernst & Young’s head of tax policy, said: ‘There have
always been areas of uncertainty in the UK tax regime and this change towards
positive engagement is good news for businesses. As an example, the provision of
an advance ruling procedure will provide absolute certainty for businesses
considering major investment in the UK as opposed to the considerable
uncertainty that they have now.’

Much will depend on the detail of the agreements. Some pre-implementation
clearance procedures are already in place, such as those on
transfer
pricing
.

It is not known at present what implications the move might have for HM
Revenue & Customs, given that clearance procedures, commonly associated with
general anti-avoidance rules, are often thought to be
expensive to implement.

Further reading

The
price of agreement

FT
profile of Sir David Varney

Accountancy Age’s Tax Hack

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