The Chartered Institute of Taxation have responded to the government’s latest proposals regarding a ‘Disclosure of Tax Avoidance Schemes (DOTAS)’ regime. This is one of a number of measures being looked at in order to cut down on tax avoidance schemes, as well as providing details of them to HMRC.
The DOTAS regime would see those who promote and use tax avoidance schemes disclosing information to HMRC when required. They are currently holding a 12 week consultation in order seek views on the use of the scheme.
Patrick Stevens, CIOT President, said that the new proposals would see a tightening of the rules for DOTAS, which has been in place since 2004 and has proved “a mostly effective way of identifying and dealing with unacceptable avoidance schemes.”
However, Mr Stevens made it clear that the CIOT’s stance was that was a need to enforce rules such as these rather than bringing in new rules which would simply impose on those who are already compliant. He also added that “the vast majority of tax advisers and their clients should have nothing to fear about these proposals – assuming they are properly targeted”.
Describing the use of these schemes Mr Stevens said; “There is a world of difference between taking advantage of legitimate reliefs, such as those for contributions to a pension fund or charitable donations, in the way intended, and promoting a totally artificial scheme which has no realistic chance of working – and indeed should not work. It is the latter that the Government is, quite rightly, targeting.”
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