HMRC could get new powers in tax avoidance clampdown

Newsletter issue – May 2025

Tax avoidance - and specifically those who promote it - has once again been pushed into the spotlight. That's because of a new review launched by the Government, as trailed at the Spring Statement.

New measures are being put forward to crackdown on the promotion of tax avoidance. HMRC would get more powers and have the option to issue stronger penalties if the proposals go forward.

Officials said the plans would empower HMRC to 'more efficiently and effectively disrupt the business model promoters rely on'.

According to official figures, around £0.5 billion of the 'tax gap' is connected to 'marketed avoidance schemes sold to individuals'.

A statement read: 'The government's intent is to make a step change in efforts to close in on the small number of remaining promoters of tax avoidance. This would contribute to closing the tax gap attributable to marketed tax avoidance.'

The measures would include enlarging the remit of the Disclosure of Tax Avoidance Schemes (DOTAS) regime and bring in a new 'Universal Stop Notice and Promoter Action Notice'.

Other suggestions include new 'highly targeted obligations and stronger information powers' and looking at ways to deal with legal professionals who contribute in some way to promoting avoidance schemes.

The consultation papers stated: 'A persistent and determined group of promoters of tax avoidance seek to exploit every opportunity to harm the tax system by selling tax avoidance schemes they claim sidestep the rules. They cause harm to public finances and to the individuals that use the schemes they promote, who often end up with large tax bills on top of the substantial fees already paid out to the promoters. The government is determined to close down this unacceptable behaviour.'