Her Majesty's Revenue and Customs published a discussion document today titled Strengthening Tax Avoidance Sanctions and Deterrents: see here (pdf). The document has attracted much media attention, in particular the penalties proposed for those involved in advising on aggressive tax avoidance schemes: see here or here. What is arguably more interesting is the potential reach of the proposed liability regime, which would operate in respect of defeated tax avoidance arrangements: it would encompass 'enablers', described as including "anyone in the supply chain who benefits from an end user implementing tax avoidance arrangements and without whom the arrangements as designed could not be implemented" (para. 2.7).Whilst company formation agents and those providing the infrastructure through which the avoidance takes place (e.g., nominee services; company director services) are obvious examples of enablers, the discussion document states (in case study 2.1) that companies would also fall within the new penalty regime where they have been used to enable the defeated tax avoidance arrangements.
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