Draft legislation and tax documents for Finance Bill 2021-22

• On 20 July 2021, Government published the supporting documents for Finance Bill 2021-22.
• This includes draft legislation and explanatory notes that allow for technical consultation (which will close on 14 September 2021).

Aspects covered include;

• Clamping down on promoters of tax avoidance – as announced in November 2020, Government is bringing forward measures to clamp down on promoters of tax avoidance. Proposals include ensuring HMRC can protect its position by freezing a promoter’s assets so that the penalties they are liable for are paid, tackling offshore promoters and the UK entities that support them, closing down companies that promote tax avoidance schemes and supporting taxpayers to identify and exit avoidance schemes.
• Notification of an uncertain tax treatment by large businesses: Draft legislation will govern the need for large businesses to notify HMRC where they have adopted an uncertain tax treatment. This will apply to returns due to be filed on or after 1 April 2022. This will provide HMRC with accurate and timely information to encourage earlier identification and resolution of uncertain tax treatments.
• Basis Period Reform: Under the current system, tax returns filed by the self-employed and partnerships are based on a business's set of accounts ending in the tax year. A set of complex rules can apply to allocate the profits of those businesses to a tax year, which can cause confusion and error. The Government has announced a reform and consultation on how to simplify the system.

See the published documents here.