Britain’s HM Revenue and Customs has sought to clarify when financial advisers will be considered “enablers” of tax avoidance when promoting tax-free investment and savings schemes.
The move is in response to government plans to fine those promoting such avoidance schemes, which led to industry unease at how the authorities would interpret the act of “enabling”. Yet such options as pensions and ISAs, for example, are not specified in the latest document from HMRC.
The list, which is published here, seeks to better establish “what makes a person an enabler of tax avoidance, and what to do about legally privileged communications.”
HMRC, the UK’s official body charged with taxation, set out plans to clamp down on advisers in its list of “tax avoidance enablers,” published in 2016. Under these new rules, and IFA could be considered an “enabler” if they attempt to sell a proposal for a tax avoidance scheme on behalf of the scheme’s promoter.
The various financial products HMRC lists include shares, derivative contracts, stock lending and alternative finance schemes, and loans.