The New Reporting Regulations - do you understand them?
Originally sent: August 3, 2004As from 1st August we are subject to new reporting regulations on tax avoidance schemes, yet even the Revenue appears to admit those regulations and the associated guidance are far from clear.
According to Inland Revenue, it will "continue to work with stakeholders to develop this guidance in the light of practical experience of using and operating the rules". In other words, the Revenue knows its regulations on tax avoidance reporting are woolly, to say the least, and it is relying on tidying them up by seeing what cases come before the commissioners and tweaking the regulations to make them work better after clearly unintended victims have been trapped.
It seems Inland Revenue are learning from Microsoft. Develop your product so it works after a fashion, but with lots of bugs in it, release it, and then rely on the consumer to report all the faults so you can tweak it and issue service packs. Expect to see a number of "anti-avoidance regulation service packs" from Inland Revenue after we have done their work for them by beta testing their product! But be careful you and your clients are not among those unintended victims. Even if the Revenue admit you should not have been caught, but are, there is certainly no guarantee they will then absolve you from the fines which will technically be due.
The moral - if in doubt, report it!
We will shortly be launching a training day based on the newly published Finance Act, which will include a section on Tax Avoidance Reporting. Keep your eye on future bulletins for further details.
Adviser Breakthrough Training Solutions Ltd. takes no responsibility for loss occasioned by any person acting or refraining from action, or in consequence of any other person acting or refraining from action, as a result of the material in this article.
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