Commentary

A4.573 Disclosure of tax avoidance schemes—penalties

Administration and compliance

A4.573 Disclosure of tax avoidance schemes—penalties

A4.573 Disclosure of tax avoidance schemes—penalties

Introduction

Under the provisions on disclosure of tax avoidance schemes ('DOTAS'), promoters and users of schemes are required to disclose details of them to HMRC1.

For each scheme reported, HMRC allots a reference number which they notify to the promoter. The promoter must pass the number on to each of their clients who enters into the scheme. The client, in turn, must notify HMRC of the reference number when they use the scheme. Detailed commentary on the DOTAS provisions is to be found at Division A7.2.

HMRC has published guidance on disclosure in this area2 which, in places, has legal force as to the means by which information is to be given.

Types of penalty

Penalties are provided for3:

  1.  

    (a)     failure by a promoter (or where there is no promoter or the promoter is not resident in the UK, by the user of the scheme) to notify details to HMRC within the prescribed time limit4 (see A7.231)

  2.  

    (b)     failure by a promoter to notify the

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