Consultation proposal targets avoidance users

Tax inspectors could soon demand information on the users of avoidance
schemes under a consultation proposed by HM Revenue & Customs last week.

The move would strengthen HMRC’s existing tax disclosure regime, and would be
used to check a transaction where it’s not clear who the taxpayer is, such as in
a tax planning scheme.

John Whiting, tax policy director at the Chartered Institute of Taxation,
said the sensitivity of HMRC’s bid to obtain taxpayer information via an
alternative source ‘deserves a proper look’, and he described the proposal as
‘surprising’. He added: ‘This one is a little more specialist and needs more

Whiting said the consultation document for this proposal addresses many of
the profession’s concerns, but HMRC needs to engage with representative bodies
to ensure the department ‘can’t administratively burden someone.’

According to Chas Roy-Chowdhury, head of taxation at ACCA, the existing
disclosure powers should provide sufficient safeguard against such schemes. ‘We
need to make sure we stick with that and not allow it to become a wider
vehicle,’ he said.

Other proposals under consultation include HMRC obtaining bulk information
powers on a group of taxpayers, such as banks, and calls for a new and
modernised excise checking framework.

The deadline for submitting comments or recommendations is 1 October.
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