A list of tax avoidance schemes whose users may be required to make an upfront payment of tax has been published by HM Revenue & Customs (HMRC).
The Finance Bill, which is due to receive Royal Assent later this month, will give HMRC a new power called accelerated payments. This will mean users of schemes with a reference number on the HMRC list may receive a notice to make an upfront payment of tax.
HMRC said it was publishing the information to help avoidance scheme users and their advisors to prepare for accelerated payments.
Starting in August 2014, HMRC will phase in the issuing of notices to current users of the schemes over a period of approximately 20 months. It will write to individuals before issuing them with a notice.
David Gauke, Exchequer Secretary to the Treasury, said on 15 July: “Most people pay the tax that is due, when it is due, so it unacceptable that a minority seek to hold on to the tax they should pay by using avoidance schemes.
“Accelerated payments will tackle the small minority of taxpayers who are currently able to put off paying tax, sometimes for several years. This will put them on the same footing as the majority of taxpayers who pay their tax up front.”
Currently, taxpayers must disclose that they are using an avoidance scheme, which HMRC may then challenge.
Taxpayers affected by accelerated payments will be free to continue to make their case to the tribunal or court and, if successful, their money will be returned with interest.
Link: HMRC’s list of schemes