The UK tax authority HMRC has noted in a press release of 8 February 2008 that more than GBP 2 million has been collected under the accelerated payments provisions. Under these provisions the users of tax avoidance schemes must pay tax up-front while their tax affairs are being investigated. According to HMRC they are successful in around 80% of these tax avoidance cases that reach the Courts. The effect of the rules is that users of avoidance schemes do not obtain any timing advantage from tax that is not paid until a case is resolved.
HMRC has is issuing more than 3,000 accelerated payment notices each month and has issued more than 41,000 notices since the relevant legislation was introduced.
The accelerated payments legislation was introduced by the Finance Act 2014 and the National Insurance Contributions Act 2015 and applies where tax avoidance schemes are required to be reported under the Disclosure of Tax Avoidance Schemes (DOTAS) rules or under the General Anti Abuse Rule (GAAR). HMRC issues an accelerated payment notice and the taxpayer must pay the tax within 90 days, subject to the right to appeal.
