817DA References to ‘specified description’ – classes of transaction for the purposes of that expression

Summary

A transition is only a disclosable transaction if it falls within certain specified descriptions. This section sets out those specified descriptions.

Details

(1) Any reference to a specified description in Chapter 3 is to be construed as a reference to one of the classes of transactions set out in subsections 2 to 10.

Confidentiality

(2) Transactions where the promoter or person (i.e. the user) would wish, or might reasonably be expected to wish, to keep the transaction or the element of the transaction that gives rise to the tax advantage, confidential from

• Revenue in order to
  • facilitate continued or repeated use,
  • prevent Revenue from using that information to enquire into the transaction or
  • prevent Revenue from using the information to withhold a refund, or
• any other promoter, in order to maintain a competitive advantage.

Fees

(3) Transactions where a promoter obtains or charges, or might reasonably be expected to obtain or charge a person wishing to implement the scheme fees that are to a significant extent attributable to the tax advantage or to any extent contingent upon the tax advantage being secured.

Standardised transactions

(4) Transactions which involve standardised or mainly standardised documentation, the form of which is largely determined by the promoter and which require certain standard transactions or steps to be entered into by the user.

Tax losses – individuals

(5) Transactions where the main outcome expected is the generation of a loss which an individual uses to reduce an income tax or capital gains tax liability.

Tax losses – corporates

(6) Transactions where a company who otherwise would have had unrelieved losses at the end of an accounting period transfers those losses to another party, who uses those losses to reduce its corporation tax liability.

Employment schemes

(7) Transactions that are expected to result in a reduction or deferral of a liability to employment taxes, by either the employer or the employee or by any other reason of the employee’s employment.

Income into capital

(8) Transactions where one would expect an income tax liability to arise, but instead a person incurs a less or no liability to income tax and acquires a chargeable asset.

Income into gift

(9) Transactions where one would expect an income tax liability to arise, but instead a person incurs a less or no liability to income tax and is deemed to take a gift.

Discretionary trusts

(10) Transactions where a party to the transaction is a trustee of a discretionary trust.

Relevant Date: Finance Act 2021