Consultation on proposals intended to remove the cash flow benefits from taxpayers using listed high risk tax avoidance schemes was also launched last month.

The proposals in the consultation document are to ‘list’ in regulations certain high risk tax avoidance schemes which users of a listed scheme would be required to disclose to HMRC and which would be subject to an additional charge on amounts underpaid. The criteria and process for listing a scheme are discussed in Chapter 3 of the document.

High risk tax avoidance schemes are defined by HMRC as being schemes which use contrived arrangements to seek tax advantages in circumstances where they are not intended to be available and which HMRC believes do not deliver the advertised tax advantages.

Under the proposals users would also be able to protect themselves from the additional charge by paying the tax in dispute upfront (i.e. when HMRC believes it should have been paid).

Closing date for comments is 31 August and the con-doc can be accessed at:-http://customs.hmrc.gov.uk/channelsPortalWebApp/channelsPortalWebApp.portal?_nfpb=true&_pageLabel=pageLibrary_ConsultationDocuments&propertyType=document&columns=1&id=HMCE_PROD1_031311