Division A7.2 Disclosure of tax avoidance schemes (DOTAS)
Updated by EILE GIBSON,
CTA, Solicitor, Tower Bridge Tax Practice
For updates affecting this Division please see Part A0 Updates
For the latest New Development, see ND.1940.
A7.201 Introduction to DOTAS
For the latest New Development, see ND.1738.
The Disclosure of Tax Avoidance Schemes (DOTAS) regime has existed for over ten years, having been introduced in 20041, and is now important part of HMRC's arsenal, targeting the tax avoidance industry. On its own DOTAS is a reporting system which enables HMRC to scrutinise anti-avoidance schemes and determine how they work and who is using them. Whilst disclosure alone should have no effect on the taxpayer, it can result in legislation which renders the scheme(s) ineffective retrospectively, thus adversely affecting earlier scheme users. Since the introduction of DOTAS, over a thousand schemes have been given scheme reference numbers (SRNs). However, coupled with the more recent additional requirement for users of schemes to be issued with accelerated payment notices (APNs), (with the potential to seriously affect scheme users' cashflows) and follower notices, as well as the potential to be penalised, named and shamed under the serial tax avoidance legislation (see A7.330–A7.335), it is expected that anti-avoidance schemes will be less attractive to most taxpayers. Furthermore, all promoters need to ensure that they do not fall within the stringent new rules for 'high risk promoters' introduced in March 2015, although HMRC have indicated that they are targeting a relatively small number of
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