V5.213H Designated provisions

The following provisions are regarded as designated provisions for the purpose of VAT 1994, Sch 11A1. A provision is regarded as fitting a description below even if it, or any feature of it, is not actually present, provided a taxable person has treated it as being present for the purpose of making a return or claim for repayment of output tax or an increase in input tax credit2.

Provisions associated with schemes

Confidentiality condition

An agreement preventing or limiting the disclosure of how a scheme gives rise to a tax advantage.

Following concerns that a literal interpretation of the legislation would result in any tax advice that was subject to a general confidentiality condition falling within the hallmark, HMRC has clarified its interpretation of the legislation3. They state that a scheme will fall within the confidentiality hallmark if:


    •     it is introduced specifically in order to prevent or limit a person from revealing details of how a particular scheme gives rise to a tax advantage, or


    •     it is specifically drawn to a client's attention by an adviser when introducing a scheme to the client in order to prevent or limit him from revealing details of how the particular scheme gives rise to a tax advantage

The sharing of the tax advantage with another party to the scheme or with the promoter

An agreement that the tax advantage to a person accruing from the operation of the scheme be shared to any extent with another party to it or another person promoting

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