Have you entered into a tax avoidance scheme?

Although tax avoidance is the legal structuring of affairs, if HMRC come across a scheme, they will work at shutting it down and re-claiming any tax lost to them.

Tax avoidance schemes and COP 8 procedures Code of Practice 8 investigations look into accusations of avoidance with the view to claw back any monies lost to the Exchequer.

If you have used or are using a scheme to avoid tax you should ring one of our specialists NOW.

HMRC investigations are lengthy and stressful experiences; and these investigations are no different.

The Anti-Avoidance Group at HMRC will close down ‘legal’ loopholes and pass any information they have about people using these schemes onto their specialist department.

If you have taken part in a scheme, Specialist Investigations may conduct a serious investigation into your affairs which COULD end in a criminal prosecution.

Types of Tax avoidance schemes

  • Film Partnership Schemes were originally introduced by the Government to encourage British film production, typically the scheme would be established as an LLP and any investors would become partners.
  • Employee Benefit Trusts enable a person to own an asset on behalf of someone else, in a bid to minimise the liability to income tax and national insurance contributions.
  • Stamp Duty Schemes is a tax avoidance scheme related to buying property.
  • Pension Schemes are similar to the EBT schemes, they work when an offshore trust is established in order to benefit employees and their families.
  • Share Loss Relief Schemes intend to create capital losses that will then reduce the amount of tax that is payable on earnings from either employment or income.

Other Tax Avoidance schemes

Inheritance Tax Schemes (IHT Schemes)

Inheritance tax is due when a persons estate, including their property, possessions and money, is worth more that £325,000 when they die. It is generally the responsibility of the executor or administrator of the deceased persons will to pay any tax, at a rate of 40%, due from the persons estate.

However, in order to avoid this a number of complex schemes were created such as the home loan and double trust schemes.

For example: The homeowner would sell their property to a trust and leave the proceeds of the sale outstanding as a loan, they would then gift the loan to the second trust. Generally the beneficiaries of the second trust would be the homeowners children, which allowed for continued occupation of the family home, but removed it from the IHT estate.

HMRC are now looking into these types schemes as tax avoidance and open enquiries into those they believe are doing this purely to avoid paying tax.

Do you want to end up in prison for avoiding tax? If your answer is ‘NO’, you NEED to get professional help NOW.

Tax avoidance is a complex issue, click here for more information on Code of Practice 8 investigations.

If you are implicated in an avoidance scheme call us NOW on 0800 471 4546 to speak to one of our dedicated specialists.

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