HMRC has updated its guidance on promoters of tax avoidance schemes (guidance on Part 5 and Schedules 34 to 36 of the Finance Act 2014).
The guidance explains the rules that apply to promoters of tax avoidance schemes. These rules aim to deter the development and use of avoidance schemes by influencing the behaviour of promoters, their intermediaries, and clients.
Stop Notices
These Notices are covered by The Finance Act 2021, Schedule 30, part 1, section 236A
- An authorised officer may give a person a Notice (a “Stop Notice”) if the authorised officer suspects that the recipient promotes, or has promoted, arrangements of a description specified in the notice or proposals for such arrangements.
HMRC issues Stop Notices to promotors of tax avoidance schemes, requiring them to stop selling or promoting the scheme.
The main aim of issuing these Notices is to reduce the number of tax avoidance schemes that are being marketed. This makes it more difficult for taxpayers to get involved in them.
When HMRC issues a stop notice to a promoter, it means:
- the promoter who receives the notice must stop selling the specified scheme
- the promoter who receives the notice must also pass a copy of it to certain associated persons, who are also subject to the stop notice and must also stop selling the specified scheme
- all those persons subject to the notice must inform HMRC of all the people they have promoted the scheme to and any they continue to promote it to
- the persons subject to the stop notice must inform all clients and intermediaries that they are subject to a stop notice, what this means, and provide them with a copy of the stop notice
If a promoter fails to comply with a stop notice they can face penalties of up to £100,000 which can increase to £1million.
Our approach to planning and HMRC
Marcus Ward Consultancy Ltd does not market, advise on, or advocate aggressive schemes. The company provides bespoke solutions to an individual business and does not believe in “one size fits all” mass-marketed schemes. We will always work within the law and the spirit of the law. We operate a full disclosure policy and may refuse to work with you if you do not subscribe to this attitude. We will, on occasion, cross swords with HMRC if we believe we are correct and that HMRC is being unreasonable and we will fight to uphold our clients’ rights against any unfair accusations.