Disclosure of tax avoidance schemes—IHT
Disclosure of tax avoidance schemes—IHT

The following Private Client practice note provides comprehensive and up to date legal information covering:

  • Disclosure of tax avoidance schemes—IHT
  • Function of the DOTAS rules
  • Source and scope of DOTAS rules for IHT
  • What creates a requirement to disclose?
  • Meaning of tax advantage
  • Meaning of main benefit
  • Who is a promoter?
  • Hallmarks
  • Confidentiality hallmark
  • Premium fee hallmark
  • More...

FORTHCOMING CHANGE: As announced at Spring Budget 2020, Finance Bill 2020–21 will include provisions to strengthen anti-avoidance rules, including the existing disclosure of tax avoidance schemes regime. Draft legislation to be included in FB 2020–21 was published on 21 July 2020. See: Draft Finance Bill 2020–21—Private Client analysis — Promoters and enablers of tax avoidance schemes.

This Practice Note describes the rules on the disclosure of tax avoidance schemes (DOTAS) applying to inheritance tax (IHT).

The procedural aspects of the rules, including time limits, how to make a disclosure, scheme reference numbers, penalties and HMRC information powers, are covered in Practice Note: Disclosure of tax avoidance schemes—procedure.

For the rules on disclosing:

  1. avoidance of income tax, corporation tax, capital gains tax (CGT) and National Insurance contributions (NICs), see Practice Note: Disclosure of tax avoidance schemes—income tax, corporation tax, CGT and NICs

  2. stamp duty land tax (SDLT) avoidance, see Practice Note: Disclosure of tax avoidance schemes—SDLT

  3. avoidance of VAT and other indirect taxes, see Practice Note: Disclosure of tax avoidance schemes—VAT and other indirect taxes (DASVOIT)

For separate (but related) rules imposing sanctions on promoters of tax avoidance schemes (POTAS), see Practice Note: Promoters of tax avoidance schemes.

EU Directive 2018/822 (sometimes known as DAC 6, because it amends the EU Directive on Administrative Cooperation) requires intermediaries or taxpayers to make reports to tax authorities about cross-border arrangements relating to tax. These rules are

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