GAAR: Disclosures in the ‘white space’

Tax practitioners will be familiar with the substantive issues in relation to the GAAR; however, notwithstanding this extensive scrutiny, the practical issues that arise have been overlooked to date. The effect of FA 2013 is to impose a requirement on a taxpayer submitting a tax return to disclose the fact that a particular scheme may contravene the GAAR. If disclosure is made, it is unclear how much detail should be given. Presumably, the disclosure would be made in the ‘white space’; however, using the ‘white space’ has implications for a subsequent discovery assessment. If no disclosure is made, and subsequently it becomes clear that it should have been, the implications for the imposition of penalties are significant.