AS 2014: Govt in further crackdown on Dotas tax avoidance schemes

The Government has announced a further crackdown on tax avoidance schemes which fall under its Disclosure of Tax Avoidance Schemes regime.

In the Autumn Statement today, the Government said it will increase penalties for non-declaration of Dotas schemes and publish more information on schemes and their promoters.

It says this will increase transparency and further educate potential scheme users of the risks of entering into marketed tax avoidance.

It will also increase HM Revenue & Customs resources in administering and enforcing the Dotas regime by creating a new taskforce in April to police promoter and user behaviour.

In addition, scheme promoters will have to declare more information about Dotas schemes to HMRC.

The Treasury estimates the measures will create an additional £150m in tax revenues over the next five years.

BDO partner and tax investigations specialist Dawn Register says: “Publishing more details about Dotas schemes is designed to deter people from using these schemes in the first place. The Government is trying to change the taxpayer mindset.

“Requiring promoters to provide more information will also mean that HMRC can intervene earlier where it has concerns.

“This is not a new agenda but it shows the Government is putting significantly more resources into this.

“It will consult on the new penalties but I would expect them to be quite severe because the Government is clearly taking this seriously.”