More than 1,000 different types of tax planning schemes for the issuing of Accelerated Payment Notices (APN) are now being targeted by HMRC as part of its crackdown on tax avoidance.
An additional 15 have recently been added to list of schemes subject to measures from HMRC around the use of APNs recently.
If a tax avoidance scheme is suspected by HMRC, an APN demands upfront payment of disputed tax. This is before a formal hearing takes place.
The tax must be paid within 90 days, without appeal.
“HMRC is determined to persist when it comes to use of APNs, despite increasingly strong resistance from those receiving such notices,” said Paul Noble, tax director at international law firm Pinsent Masons. “HMRC and HM Government have already ‘booked’ the revenue that they anticipate that these will generate and therefore will continue with their strategy of issuing notices.”
The increase comes despite problems for the HMRC when it comes to its use of APNs in recent times. In January, 2016 the governmental department was forced to withdraw APNs after admitting the demands should never have been issued.
But Noble added that court challenges have had minimal impact.
“HMRC is continuing to employ the tool aggressively, adding more targets,” he said. “Concerns are justified, they allow HMRC to demand and receive payment in advance before arguments are heard and determined. Recipients can end up facing bills for many millions, some even face bankruptcy.”