Pay Now, Argue Later

HMRC is expected to start issuing tax demands under the ‘accelerated payments of tax’ legislation imminently, now that the Finance Act 2014 has become law from 17 July.

The principle behind the new rules is that anyone using a tax avoidance scheme that falls within the disclosure of tax avoidance schemes (DOTAS) rules or is counteracted by the General Anti-Abuse Rule (GAAR) will have to pay the disputed tax up front and then argue their case in the courts.

The measure is effectively retrospective, as it applies to all open cases – potentially covering some 33,000 taxpayers and £5.1 billion of tax. Press reports suggest that, at HMRC’s request, the Ministry of Justice is now busy recruiting more solicitors and barristers to sit as judges at an expected surge of Tax Tribunals.

  (Source: HMRC)

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