The General Anti-Abuse Rule Procedure (Amendment) Regulations 2017

EXPLANATORY NOTE

(This note is not part of the Regulations)

Part 5 of the Finance Act 2013 makes provision for the General Anti-Abuse Rule (GAAR). In particular, it allows for arrangements that are thought to be abusive to be referred, in some circumstances, to the GAAR Advisory Panel. Schedules 43A and 43B to that Act set out a procedure under which, where one set of arrangements is referred to the Panel (the “lead arrangements”), equivalent arrangements can also be counteracted.

These Regulations make minor changes to the procedural rules in Schedules 43A and 43B.

Regulation 3(2)(a) amends paragraph 1(3)(a) of Schedule 43A so as to allow arrangements to be “pooled” with lead arrangements even if they give rise to a tax advantage to the same person.

Regulation 3(2)(b), (3) and (4) amend paragraph 1 of Schedule 43A so as to secure that the lead arrangements are not themselves in the “pool” with the equivalent arrangements. This is to facilitate the continuation of the “pool” of equivalent arrangements where settlement is reached in relation to the lead arrangements. Regulations 4(2), 7, 8, 9 and 12 make consequential amendments.

Regulation 4(3) makes an amendment to paragraph 2 of Schedule 43A that is equivalent to the amendment made by regulation 3(2)(a) (see above).

Regulation 5 makes clear that the decision to issue a pooling notice or notice of binding is made by a designated HMRC officer, in accordance with paragraph 1(3) of Schedule 43A.

Regulation 6(2) corrects a cross-reference.

Regulation 6(3) amends paragraph 4(3)(b) of Schedule 43A so as to allow corrective action to be taken by the taxpayer whether or not the taxpayer has made a tax appeal.

Regulation 10 secures that, where Schedule 43A requires or permits a designated HMRC officer to do something, any other designated HMRC officer may do it instead. Regulation 14 makes equivalent provision for Schedule 43B.

Regulation 13(2) clarifies that a notice under paragraph 3 of Schedule 43 may only be given in respect of arrangements in relation to which a proposal under paragraph 3(2) of Schedule 43B has been made.

Regulation 13(3) clarifies that where a person makes a proposal to HMRC under paragraph 2 of Schedule 43B, but subsequently takes corrective action in accordance with paragraph 4A of Schedule 43, a designated HMRC officer must make a referral to the GAAR Advisory Panel.

A Tax Information and Impact Note covering this instrument was published on 9 December 2015 alongside draft legislation and is available on the website at https://www.gov.uk/government/collections/tax-information-and-impact-notes-tiins. It remains an accurate summary of the impacts that apply to this instrument.