Within the new Finance Act, the Government has laid out new powers for HM Revenue & Customs (HMRC) to crack down on the promoters of tax avoidance schemes.
The measures in the 2021/22 Act are aimed at the worst offenders, including the most persistent promoters and enablers of tax avoidance.
Under the measures, HMRC will be given the power to seek freezing orders against promoters that prevent them from hiding assets before paying the penalties that are charged as a result of them breaching their obligations under the anti-avoidance regimes.
UK entities that facilitate the promotion of tax avoidance by offshore promoters will also be subject to new, harsher penalties from HMRC, as it seeks to prevent behaviour that encourages avoidance. Those that are not deterred may face a penalty up to the total fees earned by the scheme.
The Act will also enable HMRC to present winding-up petitions to the Court for companies operating against the public interest and will allow the tax authority to publicly name and shame tax avoidance promotes, including the publication of the details of the way they promote tax avoidance, and the schemes they promote.
Under this final measure, HMRC would give promotes 30 days to make representations as to why they should not be named
HMRC hopes that this will help to protect taxpayers and make them more aware of the risk involved in signing up to these schemes, while also helping those already involved to get out of avoidance.
How we can help
If you think you may have used a tax avoidance scheme or are accused of using tax avoidance measures by HMRC you must seek immediate assistance. To find out how we can assist you, please contact us.