Follower and accelerated payments notices

This Overview explores the concepts of follower notices, accelerated payment notices (APNs) and partner payment notices (PPNs), which were introduced by Finance Act 2014 (FA 2014) to help combat tax avoidance.

For the key points to note about follower notices and APNs/PPNs, see: Quick guide to follower notices and APNs—checklist.

What are follower notices?

Provided four conditions are met, HMRC can give follower notices to taxpayers who have used an avoidance scheme that has been shown to fail in another person's litigation (ie defeated in an earlier final judicial ruling). A follower notice is designed to counteract the tax advantage by incentivising the recipient of the follower notice to concede to HMRC's view and to take any necessary corrective action, such as amending a return or a claim, or to drop its appeal in accordance with the earlier final judicial ruling and therefore save HMRC the time and expense of having to litigate the same issue again. Failure to take corrective action within the required time gives rise to a penalty. For more information, see Practice Note: Follower notices.

A follower

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Latest Tax News

Tax weekly highlights—22 May 2025

This week's edition of Tax weekly highlights includes: (1) the Court of Appeal decision in Impact Contracting Solutions, (2) regulations being made to increase penalties for late payment of tax, (3) an ex-solicitor being given the first individual tax avoidance stop notice, and (4) News Analysis articles being published about the decisions of the First-tier Tax Tribunal (FTT) in Industria Umbrella and Powell.

Court of Appeal—facilitators of VAT fraud can be deregistered even if they make legitimate taxable supplies (Impact Contracting Solutions Limited v HMRC)

Tax analysis: In Impact Contracting Solutions Ltd (ICS), the Court of Appeal upheld the Upper Tribunal (UT) decision that HMRC has the power to deregister a taxable person for reasons related to tax fraud, even if the taxpayer makes other legitimate taxable supplies, provided that the deregistration is a proportionate step in the circumstances.

FTT decides that an income tax charge arose on the novation of a director’s loan account (Powell v HMRC)

Tax analysis: In Powell, the First-tier Tax Tribunal (FTT) dismissed the taxpayer’s appeal against a closure notice charging income tax under section 415 of the Income Tax (Trading and Other Income) Act 2005 (ITTOIA 2005) in respect of the release of a close company loan to a participator.

FTT imposes maximum £1m DOTAS penalty for failure to notify (HMRC v Industria Umbrella)

Tax analysis: In HMRC v Industria Umbrella, the First-tier Tax Tribunal (FTT) held that, when considering the quantum of a penalty for the failure to notify arrangements under the disclosure of tax avoidance schemes (DOTAS) rules, the amount determined by the daily penalty calculation was insufficient, holding instead that the maximum £1m penalty was necessary. The FTT noted that the fees charged by the promoter were high-level, and given the question of whether the arrangements were notifiable was not complex, there was no reason for non-compliance.