UK:
General Anti-Abuse Rule (GAAR)
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The measure
As widely anticipated, the Government announced that it intends
to accept the recommendation of the Aaronson report for the
introduction of a narrowly-focussed General Anti-Abuse Rule
(GAAR).
Who will be affected?
A consultation document will be released later this year, with
the intention of introducing the new rule next year. It will apply
to income tax, capital gains tax, corporation tax, petroleum
revenue tax, NIC and SDLT.
When?
The GAAR will apply from April 2013.
Our view
Our view is that a narrowly-focussed GAAR, which targets
transactions with the sole purpose of avoiding tax should cut down
artificial, aggressive schemes, without adversely affecting
business. A wider GAAR would simply add uncertainty and would not
be helpful, either for HMRC or for business.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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