Finance Act 2014

[F1 “Defeat” of arrangements U.K.

Textual Amendments

F1 Sch. 34A inserted (15.9.2016) by Finance Act 2016 (c. 24), s. 160(5)

10 U.K. For the purposes of this Part of this Act a “defeat” of arrangements occurs if any of Conditions A to F (in paragraphs 11 to 16) is met in relation to the arrangements.

11 U.K. Condition A is that—

(a) a person has made a return, claim or election on the basis that a tax advantage arises from the arrangements,

(b) a notice given to the person under paragraph 12 of Schedule 43 to, paragraph 8(2) or 9(2) of Schedule 43A to or paragraph 8(2) of Schedule 43B to FA 2013 stated that the tax advantage was to be counteracted under the general anti-abuse rule,

(c) the tax advantage has been counteracted (in whole or in part) under the general anti-abuse rule, and

(d) the counteraction is final.

12 (1) Condition B is that a follower notice has been given to a person by reference to the arrangements (and not withdrawn) and— U.K.

(a) the person has complied with subsection (2) of section 208 of FA 2014 by taking the action specified in subsections (4) to (6) of that section in respect of the denied tax advantage (or part of it), or

(b) the denied tax advantage has been counteracted (in whole or in part) otherwise than as mentioned in paragraph (a) and the counteraction is final.

(2) In this paragraph “the denied tax advantage” is to be interpreted in accordance with section 208(3) of FA 2014.

(3) In this Schedule “follower notice” means a follower notice under Chapter 2 of Part 4 of FA 2014.

13 (1) Condition C is that— U.K.

(a) the arrangements are DOTAS arrangements,

(b) a person (“the taxpayer”) has made a return, claim or election on the basis that a relevant tax advantage arises,

(c) the relevant tax advantage has been counteracted, and

(d) the counteraction is final.

(2) For the purposes of sub-paragraph (1) “relevant tax advantage” means a tax advantage which the arrangements might be expected to enable the taxpayer to obtain.

(3) For the purposes of this paragraph the relevant tax advantage is “counteracted” if adjustments are made in respect of the taxpayer's tax position on the basis that the whole or part of that tax advantage does not arise.

14 (1) Condition D is that— U.K.

(a) the arrangements are disclosable VAT [F2 or other indirect tax] arrangements to which a F3 ... person is a party,

(b) the F4 ... person has made a return or claim on the basis that a relevant tax advantage arises,

(c) the relevant tax advantage has been counteracted, and

(d) the counteraction is final.

(2) For the purposes of sub-paragraph (1) “relevant tax advantage” means a tax advantage which the arrangements might be expected to enable the F5 ... person to obtain.

(3) For the purposes of this paragraph the relevant tax advantage is “counteracted” if adjustments are made in respect of the F6 ... person's tax position on the basis that the whole or part of that tax advantage does not arise.

Textual Amendments

F2 Words in Sch. 34A para. 14(1)(a) inserted (16.11.2017 for specified purposes, 1.1.2018 in so far as not already in force) by Finance (No. 2) Act 2017 (c. 32), s. 66(4), Sch. 17 para. 54(3)(a)

F3 Word in Sch. 34A para. 14(1)(a) omitted (16.11.2017 for specified purposes, 1.1.2018 in so far as not already in force) by virtue of Finance (No. 2) Act 2017 (c. 32), s. 66(4), Sch. 17 para. 54(3)(b)

F4 Word in Sch. 34A para. 14(1)(b) omitted (16.11.2017 for specified purposes, 1.1.2018 in so far as not already in force) by virtue of Finance (No. 2) Act 2017 (c. 32), s. 66(4), Sch. 17 para. 54(3)(b)

F5 Word in Sch. 34A para. 14(2) omitted (16.11.2017 for specified purposes, 1.1.2018 in so far as not already in force) by virtue of Finance (No. 2) Act 2017 (c. 32), s. 66(4), Sch. 17 para. 54(3)(b)

F6 Word in Sch. 34A para. 14(3) omitted (16.11.2017 for specified purposes, 1.1.2018 in so far as not already in force) by virtue of Finance (No. 2) Act 2017 (c. 32), s. 66(4), Sch. 17 para. 54(3)(b)

15 (1) Condition E is that the arrangements are disclosable VAT arrangements to which a taxable person (“T”) is a party and— U.K.

(a) the arrangements relate to the position with respect to VAT of a person other than T (“S”) who has made supplies of goods or services to T,

(b) the arrangements might be expected to enable T to obtain a tax advantage in connection with those supplies of goods or services,

(c) the arrangements have been counteracted, and

(d) the counteraction is final.

(2) For the purposes of this paragraph the arrangements are “counteracted” if—

(a) HMRC assess S to tax or take any other action on a basis which prevents T from obtaining (or obtaining the whole of) the tax advantage in question, or

(b) adjustments are made on a basis such as is mentioned in paragraph (a).

16 (1) Condition F is that— U.K.

(a) a person has made a return, claim or election on the basis that a relevant tax advantage arises,

(b) the tax advantage, or part of the tax advantage would not arise if a particular avoidance-related rule (see paragraph 25) applies in relation to the person's tax affairs,

(c) it is held in a judicial ruling that the relevant avoidance-related rule applies in relation to the person's tax affairs, and

(d) the judicial ruling is final.

(2) For the purposes of sub-paragraph (1) “relevant tax advantage” means a tax advantage which the arrangements might be expected to enable the person to obtain.]