TaxCorporate TaxPBR05: Anti-avoidance raises £1bn

PBR05: Anti-avoidance raises £1bn

Measures will bring huge windfall for chancellor

The chancellor has announced a range of anti-avoidance measures that will
raise more than £1bn by 2008/9.

Chief amongst them is the change to the 0% rate on incorporations, which the
Treasury thought many small companies were abusing, raising £530m.

Capital loss provisions, which prevent companies buying other companies with
capital losses unless there is a ‘commercial purpose’ to the transaction, will
raise £300m, the next largest revenue raising measure, by 2007/8.

A crackdown on corporate intangible assets avoidance will raise £120m by
2007/8, whilst HMRC has disclosed that the effect of insurance company
provisions will be £155m this year, and £85m by 2007/8.

Perhaps the most interesting measure, however, is the change to the
disclosure rules. HMRC has announced discussions with stakeholders over the
disclosure regime, in an apparent attempt to ensure that it is watertight.

The rules will hammer advisers, already seeing their business decline in the
wake of earlier announcements: ‘All of the income from tax planning has gone
belly up since the chancellor started his disclosure rules. He has closed many
things down and now he is going to tighten the rules again,’ said Alastair
Kendrick, of Wilder Coe.

Related Articles

Watch out when winding up

Corporate Tax Watch out when winding up

1m Emma Rawson, ATT Technical Officer
How might Brexit affect UK tax policy?

Brexit & Economy How might Brexit affect UK tax policy?

1m Santhie Goundar
Corporation tax losses – your newly flexible friends

Corporate Tax Corporation tax losses – your newly flexible friends

3m Emma Rawson, ATT Technical Officer
HMRC large business tax enquiry duration rises to 3 years

Corporate Tax HMRC large business tax enquiry duration rises to 3 years

4m Emma Smith, Managing Editor
SMEs paying higher rate of corporation tax than big businesses

Corporate Tax SMEs paying higher rate of corporation tax than big businesses

4m Alia Shoaib, Reporter
Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

Corporate Tax Big names, little tax: Airbnb, Facebook, Kellogg’s, eBay

7m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

7m Emma Rawson, ATT Technical Officer
EU divided over radical tax reforms targeting tech giants

Corporate Tax EU divided over radical tax reforms targeting tech giants

8m Alia Shoaib, Reporter