The number of tax avoidance schemes disclosed to HMRC has fallen by more than a third in the past year. According to law firm Pinsent Masons, the number of schemes disclosed is at its lowest point since disclosure of tax avoidance schemes (DOTAS) launched in 2004. In 2004/05, 587 schemes were disclosed to HMRC. The numbers of disclosed schemes have dropped each year thereafter, to 121 in 2011/12 and 77 in 2012/13.
Jason Collins, head of tax at Pinsent Masons, commented: ‘The figures show that HMRC is taking a tougher stance on tax avoidance and winning the battle, if not the war, to eliminate elaborate tax schemes. They have been successful in dissuading the bigger accountancy firms from creating new tax avoidance schemes, with many major professional services firms now avoiding the more extreme forms of tax planning, as it carries with it a reputational risk.’
A spokesman for HMRC told Tax Journal: ‘HMRC seeks the full amount of tax which it believes is legally due and is actively working open avoidance cases towards resolution in accordance with its litigation and settlement strategy, either by agreement or through the courts. This strategy has brought consistency to the way we settle tax disputes. The key rules – no deals or “splitting the difference” – and our track record of success in litigation have contributed to a reduction in tax avoidance. It would be wrong to settle for anything less than the full amount HMRC believes is legally due and would simply encourage those who market avoidance schemes, and taxpayers with an appetite for tax avoidance, to take a chance that they will be better off by trying to avoid tax, rather than by paying the tax due.’
The number of tax avoidance schemes disclosed to HMRC has fallen by more than a third in the past year. According to law firm Pinsent Masons, the number of schemes disclosed is at its lowest point since disclosure of tax avoidance schemes (DOTAS) launched in 2004. In 2004/05, 587 schemes were disclosed to HMRC. The numbers of disclosed schemes have dropped each year thereafter, to 121 in 2011/12 and 77 in 2012/13.
Jason Collins, head of tax at Pinsent Masons, commented: ‘The figures show that HMRC is taking a tougher stance on tax avoidance and winning the battle, if not the war, to eliminate elaborate tax schemes. They have been successful in dissuading the bigger accountancy firms from creating new tax avoidance schemes, with many major professional services firms now avoiding the more extreme forms of tax planning, as it carries with it a reputational risk.’
A spokesman for HMRC told Tax Journal: ‘HMRC seeks the full amount of tax which it believes is legally due and is actively working open avoidance cases towards resolution in accordance with its litigation and settlement strategy, either by agreement or through the courts. This strategy has brought consistency to the way we settle tax disputes. The key rules – no deals or “splitting the difference” – and our track record of success in litigation have contributed to a reduction in tax avoidance. It would be wrong to settle for anything less than the full amount HMRC believes is legally due and would simply encourage those who market avoidance schemes, and taxpayers with an appetite for tax avoidance, to take a chance that they will be better off by trying to avoid tax, rather than by paying the tax due.’
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