Value Added Tax

VAT And The Act

TACKLING AVOIDANCE WAS a theme of the Budget and the Finance Act. The rules on disclosure of avoidance schemes are one of the major developments in both VAT and direct taxes. In spite of the impending merger of Customs with the Revenue the rules and arrangements for disclosure are quite different.

The Finance Act inserts a new Schedule 11A into VAT Act 1994 which provides for regulations to cover what must be disclosed to Customs.

For the purposes of these rules a scheme includes any arrangements transaction or series of transactions. It is difficult to see how anything done by way of business would not be a scheme under this definition. As a result some people may think that they are carrying on their business in the most efficient and sensible way but they may...