HMRC has published further guidance on the settlement opportunity, announced last month, for users of certain tax avoidance schemes that use ‘gearing’ to maximise tax relief.
Jason Collins, head of tax at Pinsent Masons, has described HMRC’s terms as ‘paltry’. He questioned whether scheme participants would be encouraged to settle.
Last week the department published a series of FAQs and the terms of the settlement opportunity for ‘UK GAAP partnership schemes’.
Yesterday’s announcement sets out the terms in relation to ‘partnership reliefs and allowances schemes’, including those which have sought to ‘create losses in partnerships through reliefs such as first year allowance, payments made for restrictive covenants [and] specific capital allowances’.
'Huge backlog'
‘It is clear that a bulk settlement is needed to clear the huge backlog of cases,’ said Collins. Writing in last week’s issue of Tax Journal, he suggested that the terms on offer ‘just do not seem to go far enough to encourage participation by the core rump of investors, for whom holding out for the possibility of an overall win is a risk worth taking’.
It was difficult to see, however, what other terms HMRC could offer ‘whilst shackled by its litigation and settlement strategy’.
HMRC has published further guidance on the settlement opportunity, announced last month, for users of certain tax avoidance schemes that use ‘gearing’ to maximise tax relief.
Jason Collins, head of tax at Pinsent Masons, has described HMRC’s terms as ‘paltry’. He questioned whether scheme participants would be encouraged to settle.
Last week the department published a series of FAQs and the terms of the settlement opportunity for ‘UK GAAP partnership schemes’.
Yesterday’s announcement sets out the terms in relation to ‘partnership reliefs and allowances schemes’, including those which have sought to ‘create losses in partnerships through reliefs such as first year allowance, payments made for restrictive covenants [and] specific capital allowances’.
'Huge backlog'
‘It is clear that a bulk settlement is needed to clear the huge backlog of cases,’ said Collins. Writing in last week’s issue of Tax Journal, he suggested that the terms on offer ‘just do not seem to go far enough to encourage participation by the core rump of investors, for whom holding out for the possibility of an overall win is a risk worth taking’.
It was difficult to see, however, what other terms HMRC could offer ‘whilst shackled by its litigation and settlement strategy’.
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