General Anti-Abuse Rule

The General Anti-Abuse Rule (GAAR) was brought into force in July 2013 as a way to manage the risk of tax avoidance and to target abusive avoidance schemes without damaging the overall competitiveness of the UK financial system..  The GAAR legislation defines the kinds of tax arrangements which are deemed to be abusive and applies to Corporation Tax (including amounts treated as Corporation Tax), Income Tax, Capital Gains Tax, National Insurance, Inheritance Tax, Stamp Duty Land Tax, Petroleum Revenue Tax, and the Annual Tax on Enveloped Dwellings.

Recent changes to the GAAR came into effect in September 2016 with the Finance Act 2016 which introduced penalties for people entering into abusive tax arrangements on or after 15 September 2016.  The changes allow the HMRC to give provisional counteraction notices which will inform taxpayers about the adjustments that may be needed to counteract a tax advantage arising from an arrangement.  It also introduced the concepts of 'pooling', 'binding' and 'generic referrals'. 'Pooling' places tax arrangements into a pool with the lead arrangements.  A 'binding notice' is issued to taxpayers with equivalent arrangements so that they can all be dealt with by a single GAAR Advisory Panel decision) and 'generic referrals' refers to an HMRC officer's recommendation for referral to the GAAR Advisory Panel in respect of the arrangements in the pool.

Bright Line Law is a specialist provider in this area. We regularly work with other experts in the field of tax law - including forensic and chartered accountants, and professional tax advisors - to assist clients and deliver pragmatic solutions to legal problems. Our goal is to resolve regulatory issues quickly and provide a rigorous defence to accusations of violations of tax law. If you require specialist advice on anti-abuse rules, contact a member of our team or telephone us on + 44 (0)203 709 9470. 

Jonathan Fisher QC
Lead Counsel

Telephone + 020 3872 2852

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