Opportunities to Extend Uncertain Tax Treatment

Q: Annex A: List of stakeholders consulted

Chartered Institute of Taxation ( CIOT ) Institute of Chartered Accountants in England and Wales ( ICAEW ) Institute Of Chartered Accountants of Scotland ( ICAS ) BDO

Question 1

Summary

Accepted Answer

Subject of this consultation

The government intends to widen the existing Notification of Uncertain Tax Treatment (UTT) by Large Businesses regime to require additional legal interpretation uncertainties to be notified to HMRC.

Scope of this consultation

This consultation sets out the areas of the UTT regime that the government intends to change, and seeks views on:

the proposal to bring individual taxpayers and trusts within scope of UTT
the proposal to include Stamp Duty Land Tax (SDLT) National Insurance contributions (NICs), the Construction Industry Scheme (CIS), Capital Gains Tax (CGT) and Inheritance Tax (IHT) within scope of UTT
the wording of the proposed additional triggers, that, if met, will require notification of legal interpretation uncertainties — ‘Legal interpretation’ is where the taxpayer and HMRC interpret the law differently and that results in a different tax outcome

Who should read this

We welcome responses from large businesses, representative bodies, industry bodies, trustees and individuals potentially impacted by the proposals.

Duration

This consultation will run for 12 weeks from 12 March 2026 until 4 June 2026.

Lead officials

The lead officials are Adrian Morton and Laura Maddison of HM Revenue and Customs (HMRC).

How to respond or enquire about this consultation

Level 5
1 Ruskin Square
Croydon
CR0 2LX

uncertaintaxtreatmentconsultationresponses@hmrc.gov.uk

Additional ways to be involved

HMRC will be keen to hold or attend meetings with interested parties to discuss these proposals.

After the consultation

The government will aim to publish its response in summer 2026. The government intends that any legislation will be introduced in the next available Finance Bill and will apply to returns filed after 1 April the following year.

Getting to this stage

Building on the successful implementation of UTT, as highlighted in the July 2025 evaluation, this consultation explores options to further enhance and extend the regime. It advances the development of an additional trigger to ensure notification of further legal interpretation tax uncertainties, in line with the principles set out in the government’s Tax Policy Principles.

Previous engagement

During the development of UTT, 2 consultations were undertaken. The first consultation set out HMRC objectives for introducing the regime, its intended scope, threshold, and exclusions. It also explained the proposed approach to defining an ‘uncertain tax treatment’ and how this definition would apply in practice. The consultation document and the summary of responses can be accessed via the links below:

The responses to the first consultation were considered, and a second consultation was published to seek views on the revised proposals. In particular, it asked whether stakeholders agreed that the amended definitions of what were uncertain tax treatments, were more objective. The tax advantage threshold (being the tax difference between the interpretation the taxpayer has taken compared to HMRCs interpretation) was also increased from £1 million to £5 million, and the number of taxes in scope were reduced.

Question 2

1. Executive summary

Accepted Answer

It was announced at Budget 2025 that the government will consult on options to extend the Notification of Uncertain Tax Treatment by Large Businesses (UTT) regime.

UTT was introduced in 2022 to bring legal interpretation uncertainties to HMRCs attention, so they can be discussed and resolved sooner. Not only does this promote fairness and transparency but also contributes towards reducing the legal interpretation portion of the tax gap.

The total tax gap is estimated to be £46.8 billion in the 2023 to 2024 tax year. The legal interpretation portion of the tax gap was £5.4 billion (12%) of the total Tax Gap.

As of 1 January 2026, there have been more than 30 notifications, involving a potential tax at risk estimated to be £1 billion. However, the narrow scope of the 2 existing notification conditions means that some legal‑interpretation issues may not meet the current thresholds for notification and therefore may not be brought to HMRC’s attention.

The proposal is to extend the existing UTT regime to require more legal interpretation uncertainties to be notified to HMRC, thereby improving transparency and ensuring consistent and fair treatment to other taxpayers and taxes.

The consultation will propose broadening the range of legal interpretation uncertainties that are notifiable by:

including individuals and trusts within scope of the UTT regime
adding further taxes to be within scope of UTT:
- Stamp Duty Land Tax (SDLT)
- National Insurance contributions (NICs)
- Construction Industry Scheme (CIS) obligations
- Inheritance Tax (IHT)
- Capital Gains Tax (CGT)
introducing an additional trigger

The government intends that any legislation will be introduced in the next available Finance Bill and will apply to returns filed after 1 April the following year.

Question 3

2. About you

Accepted Answer

This section gathers information about the types of respondents who will contribute to the consultation.

Responses are sought from a range of organisations — entities offering their personal perspective as well as professional and industry bodies on behalf of their members. This information will assist in understanding the perspective from which the response was given, along with insight into sectors and size of organisation.

Question 1: Are you responding to this survey as:

a business
a representative body
an organisation
an individual
other (please provide details)

Question 2: Are the views offered in your responses:

your own views
your organisation’s views
your members’ views

Question 3: What is your industry sector (such as accounting, finance, software, retail, construction, other)?

Question 4: To help us determine business size, please provide details on:

number of employees in your business
annual turnover

Question 5: Please provide any further information about your organisation or business activities that you think might help us put your answers in context.

Question 4

3. Introduction

Accepted Answer

3.1. Background

It was announced at autumn Budget 2025 that the government will consult on options to extend the Notification of Uncertain Tax Treatment by Large Businesses (UTT) regime.

The proposal is to extend the existing UTT regime to require more legal interpretation uncertainties to be notified to HMRC.

The aim of the changes is to increase HMRC’s ability to identify, at an earlier stage, instances where businesses have adopted legal interpretations that differ from HMRC’s published view, or where HMRC’s view is not yet known. Earlier visibility of such uncertainties supports timely dialogue and helps ensure that any associated tax risks can be understood and addressed appropriately.

This consultation sets out the proposed changes to the UTT regime and seeks views on a range of implementation issues.

The government intends that any legislation will be introduced in the next available Finance Bill and will apply to returns filed after 1 April the following year.

3.2. Purpose

Legal interpretation uncertainties arise where the customer’s and HMRC’s interpretation of the law and how it applies to the facts in a particular case result in a different tax outcome, and there is no avoidance.

Examples include categorisation, such as an asset for allowances or VAT liability of a supply, the accounting treatment of a transaction, or the methodology used to calculate the amount of tax due as in transfer pricing, or VAT partial exemption.

There are various drivers that cause legal interpretation uncertainties including:

differences in interpretation of the law — meaning what the law says or means
differences in interpretation of facts (primary facts or secondary deductive facts for example status) affecting whether and how the law is applied
differences in approaches to valuation, apportionment, calculation or allocation —affecting largely the quantum of the tax outcome under the law

There is a spectrum of behaviour related to legal interpretation losses. This includes customers who encounter genuine shortfalls in the clarity of the legislation or supporting guidance, through to those who would look to exploit positions that could be seen as speculative or untenable, if scrutinised by a tribunal or court.

The aim of the current UTT regime is to help reduce the legal interpretation portion of the tax gap by encouraging large businesses to identify and disclose legal interpretation uncertainties to HMRC at an early stage. Early discussion of uncertainties encourages a level playing field with those taxpayers who are already open and transparent with HMRC, and results in uncertainties being clarified sooner.

Multiple factors such as wider fluctuations in the economy and additional compliance activity all affect the tax gap and its yearly revisions. Therefore, it is not useful to use a before and after comparison of the tax gap in determining the success of the UTT policy. However, as of 1 January 2026 there have been more than 30 notifications, involving a potential tax at risk estimated to be £1 billion. HMRC accepts that some of this potential tax at risk would have been identified during usual compliance activity, and in some cases, HMRC may agree with the interpretation a business has adopted.

A recent evaluation of UTT concluded that UTT is meeting its objectives of changing businesses’ behaviour by increasing tax position transparency for some who were not transparent, and promoting equality for those who already were transparent. As a result, UTT is contributing to reducing the legal interpretation portion of the tax gap. The evaluation also concluded that the one‑off set‑up and ongoing costs of complying with the regime are considered small and reasonable by the majority of businesses, with no evidence of a material compliance burden associated with UTT.

However, the narrow nature of the 2 conditions requiring a notification under the UTT regime means some businesses are not required to make HMRC aware of uncertainty in their tax affairs. For example, if a business is uncertain of the correct tax treatment to be applied, and HMRCs position is not known, there is no requirement to make a notification, yet uncertainty remains.

The government therefore wants to build on the existing structure of UTT and widen the scope to require notifications of additional uncertainties, from persons not currently within scope, and involving other taxes.

3.3. Legislative history

The Notification of Uncertain Tax Treatment by Large Businesses (UTT) regime was enacted in Schedule 17 to the Finance Act 2022, and applies to Corporation Tax (CT), Value Added Tax (VAT) and Income Tax (IT) (including PAYE) returns filed after 1 April 2022.

It requires large businesses to notify HMRC of legal interpretation uncertainties where the tax advantage exceeds £5 million and satisfy either or both criteria:

the business is taking a position that is contrary to HMRC’s known position, as published in guidance or in direct dealings with HMRC, or
the business has made a provision in their accounts to reflect that their interpretation may not be successful if challenged

Businesses are exempted from notifying HMRC where it is reasonable for them to believe that HMRC is already aware of the uncertainty.

Shortly before the UTT regime was introduced, a third trigger was proposed but ultimately removed because it was considered too subjective, making it difficult for taxpayers to determine whether notification was required.

Although the third trigger was removed, the previous government stated that it remained committed to developing an additional notification requirement to capture uncertainties not covered by the 2 enacted triggers. The current government has reconfirmed that commitment.

It was decided to defer adding an additional trigger until at least 2 annual return cycles had passed and an evaluation of the regime’s impact and associated compliance burden had been completed. This enabled taxpayers and their agents/representatives to experience how UTT operates and the government could be informed by the results of the evaluation when considering expansion. The evaluation was published in July 2025.

Respondents to previous consultations when UTT was being developed, raised concerns about the potential disproportionate compliance costs. However, the evaluation concluded that most respondents thought the compliance costs were reasonable, and to date UTT has identified a potential tax at risk estimated to be £1 billion.

This consultation also builds on the recent publication of Guideline for Compliance 13 (Help ensuring documents filed with HMRC are correct and complete), which provides guidance when taxpayers are uncertain about their tax affairs or are considering novel interpretations of the law. The guideline provides HMRC’s view on how taxpayers should choose an interpretation that is most likely to be correct. If the interpretation remains uncertain and one of the UTT triggers is satisfied, then the taxpayer should notify HMRC and the uncertainty can be discussed and clarified.

3.4. Proposals

The evaluation of UTT concluded that the notification requirement is bringing legal interpretation uncertainties to HMRCs attention, involving a potential tax risk estimated to be £1 billion, thereby contributing towards reducing the legal interpretation portion of the tax gap.

The government wants to build on the existing UTT requirements and insights from the recent evaluation and explore options to require additional legal interpretation uncertainties to be brought to HMRCs attention. This will mean that the uncertainties are discussed, clarified and resolved sooner; even if this means they are litigated earlier than would otherwise happen.

The areas where the government believe UTT can be expanded to require more uncertainties to be notified under UTT are:

bringing other types of taxpayers within scope — individuals and trusts where the tax advantage of the legal interpretation exceeds £5 million
including additional taxes within scope, such as Stamp Duty Land Tax (SDLT), National Insurance contributions (NICs) and the payments under the Construction Industry Scheme (CIS). Also, Capital Gains Tax (CGT) and Inheritance Tax (IHT)
introducing an additional trigger or triggers, to broaden the range of legal interpretation uncertainties that are notifiable

Question 5

4. Proposals in detail

Accepted Answer

4.1. Additional taxpayers

4.1.1. Individuals

UTT currently only applies to companies and partnerships. However, evidence suggests that some individuals also experience legal interpretation uncertainties. The total tax gap for wealthy individuals^{[footnote 1]} was estimated at £2.1 billion in the 2023 to 2024 tax year. Over half of the tax gap attributable to wealthy individuals comes from legal interpretation of the law. Bringing these individuals within scope would ensure such uncertainties are identified and resolved sooner.

Wealthy individuals often have complicated tax affairs covering multiple taxes. They often have a wide spread of tax liabilities on both their income (in the form of Income Tax and National Insurance) and assets (in the form of Capital Gains Tax, Inheritance Tax and Stamp Duties).

Wealthy individuals may adopt complex and sophisticated tax planning to reduce these liabilities. The complexity of their tax affairs may increase the potential for non-compliant behaviour, either deliberately in the form of tax avoidance or evasion, or mistakenly, by applying tax rules incorrectly. HMRC therefore treats wealthy individuals separately from other individual taxpayers.

As the intention is to target only high value uncertain legal interpretations, we propose to only require a notification if the tax advantage exceeds £5 million.

As individual taxpayers involved in transactions/interpretations of this magnitude are not usually in business in their own right, they often do not have a business turnover or prepare an annual balance sheet, which are used to determine whether businesses fall within scope of UTT for other taxpayers. Consequently, the existing turnover threshold of £200 million and the balance sheet total threshold of £2 billion cannot be used to define these taxpayers.

Therefore, although ‘wealthy’ individuals are defined elsewhere in the tax code, the government proposes not to define an individual taxpayer for the purposes of UTT, but to include all individual taxpayers within scope of UTT where they make a legal interpretation that results in more than £5 million tax advantage that is notifiable under one of the triggers. The government believes that the £5 million tax advantage will focus the requirement on the legal uncertainties that are of interest, without adding an additional level of complexity of defining the population within scope.

The turnover and balance sheet thresholds will remain for companies and partnerships, and the difference in approach is due to it being less likely that individuals will satisfy the £5 million tax advantage, whereas it’s far more likely that businesses would. Therefore, UTT is focused on the very large businesses (by their turnover and balance sheet), and it is proposed that the very large legal interpretations made by individuals are identified solely by the tax advantage.

If any of the triggers are met, a notification would be required at the same time as the income tax return is due covering the period when an uncertain legal interpretation was made.

Where an individual is a partner in a partnership, only legal interpretations made by the partner will be considered within scope of UTT. A partner will not have to notify of legal interpretation uncertainties that satisfy the criteria, made by the partnership.

Question 6: Do you agree that we should focus solely on the ‘tax advantage’ amount to identify legal interpretation uncertainties of interest?

Question 7: Do you agree with how we propose to determine the tax advantage for individuals?

4.1.2. Trusts

As mentioned above, UTT currently only applies to companies and partnerships. In addition to extending UTT to include individuals, and for the same reasons, we would like to include trusts.

Trusts also regularly make legal interpretations that would be considered uncertain, and some of those interpretations result in a tax advantage of more than £5 million.

Therefore, the government would like to bring trusts within scope of UTT so that their legal interpretation uncertainties are brought to HMRCs attention and that they can be resolved sooner.

Similar to individuals, many trusts are not in business in their own right, and therefore do not have a business turnover, nor do they usually prepare an annual balance sheet, which help determine whether businesses are within scope. Therefore, the turnover threshold of £200 million and the balance sheet total of £2 billion cannot be used to refine these taxpayers to identify uncertainties.

Consequently again, we propose to include all trusts within scope, regardless of the type of trust, and a legal interpretation is notifiable where it satisfies any of the criteria to notify and there is a difference between the trust’s interpretation and the alternative interpretation which creates a tax advantage of more than £5 million tax.

If any of the triggers are met, a notification would be required at the same time as the income tax return is due covering the period when an uncertain legal interpretation was made. For those trusts registered for VAT, the obligation to notify would be on or before the date on which the last VAT return for the financial year is required to be made.

Where a trust is a partner in a partnership or owns shares in a company, only legal interpretations made by the trust will be considered within scope of UTT. A partner will not have to notify of legal interpretation uncertainties that satisfy the criteria, made by the partnership, nor will a shareholder in a company have to notify of legal uncertainties made by the company.

Question 8: Do you agree with including all trusts within scope?

Question 9: Can you foresee any practical issues with including trusts within scope of UTT?

4.2. Additional taxes within scope

The recent evaluation concluded that UTT is helping to identify legal interpretation uncertainties and therefore meeting its objective. However, UTT currently applies only to Corporation Tax, VAT and Income Tax (including PAYE). To build on the benefit of UTT, the government proposes extending the taxes within scope of UTT to include Stamp Duty Land Tax (SDLT), National Insurance contributions (NICs) and payments under the Construction Industry Scheme (CIS). With the government proposing to bring individuals within scope of UTT, it is also proposed to include Inheritance Tax (IHT) and Capital Gains Tax (CGT) within scope.

Extending UTT to include further taxes could provide an opportunity for taxpayers to work collaboratively with HMRC. This helps to ensure the correct interpretation is made, or to discuss areas of differing interpretation upfront, thereby possibly reducing the need for later compliance activity or litigation.

4.2.1. National Insurance contributions (NICs)

NICs are currently included within scope of UTT, but only for calculating the £5 million tax advantage threshold in relation to income tax uncertainties. There is no requirement to notify uncertainties solely involving NICs.

HMRC measures the tax gap for Income Tax (IT), NICs and CGT as a single combined figure and does not provide a specific breakdown for NICs in isolation. The combined tax gap (covering all types of behaviours) for IT, NICs and CGT was £14.4 billion in the 2023 to 2024 tax year.

HMRC is aware of legal interpretation uncertainties relating to NICs that justify bringing NICs fully within scope of the regime. Early notification would enable HMRC to work constructively with taxpayers to clarify the matter sooner than would otherwise occur.

Proposal:

The government proposes to include all classes of NICs within scope of UTT, recognising that the £5 million threshold would usually only be exceeded for Primary and Secondary Class 1 NICs.

Notification would be required on or before the due date of the last return for the financial year that covers the period of the NICs legal interpretation uncertainty.

Question 10: Can you foresee any practical issues with including NICs within UTT?

Question 11: Do you agree with proposed due date to notify a NICs legal interpretation uncertainty, or do you prefer a single due date for all UTT notifications (refer section 4.4)?

4.2.2. Construction Industry Scheme (CIS)

There are legal interpretation uncertainties around whether a contractor is within scope of CIS and whether withholding deductions must be made from payments to sub-contractors. Payments made under CIS are not a separate tax but represent withholding of tax and NICs on payments to sub-contractors. Similar to PAYE deductions for employees.

The deadline for a monthly CIS return is the 19 of the month following the last tax month. We propose the notification being due by the due date for the last CIS return in an accounting period.

Proposal:

The government proposes that legal interpretation uncertainties concerning withholding deductions under CIS should be notifiable where they involve a legal interpretation uncertainty that meets the other criteria.

Question 12: Do you agree with the due date for notification involving CIS deductions to be the last CIS return due in an accounting period, or do you prefer a single due date for all UTT notifications (refer to section 4.4)?

Question 13: Can you foresee any practical issues with including CIS within UTT?

4.2.3. Stamp Duty Land Tax (SDLT)

Legal interpretation issues within SDLT can make it difficult for taxpayers to understand their obligations, particularly where the rules must be applied to varied or complex transactional circumstances. As SDLT applies to both residential and non-residential properties, both would be within scope.

It is difficult to estimate revenue loss associated with SDLT legal interpretation uncertainties. However, the total tax gap attributed to SDLT was £275 million in the 2023 to 2024 tax year. As a self-assessed tax, if a taxpayer interprets the legislation in a way that means (in their view) that no SDLT return needs to be filed, HMRC cannot know the amount of SDLT linked to that interpretation, until compliance activity is conducted. However, evidence gathered from compliance activity indicates that there are legal interpretation uncertainties involving SDLT which have tax advantages exceeding £5 million in each case.

Proposal:

Amend the UTT legislation to require notification on or before the date that an SDLT return would otherwise be due, where other UTT criteria are met.

Note: Land transaction taxes are devolved to Scotland and Wales, therefore, the UTT notification requirement would apply only to transactions involving property in England and Northern Ireland.

Question 14: Do you agree with the due date for notification involving SDLT to be when a return covering that transaction would otherwise be due, or do you prefer a single due date for all UTT notifications (refer section 4.4)?

Question 15: Can you foresee any practical issues with including SDLT within scope of UTT?

4.2.4. Capital Gains Tax (CGT)

With the proposal to bring individuals within scope of UTT, it is logical to include all the taxes for which individuals would be liable. This is particularly the case due to the extent of legal interpretation uncertainties existing around determining the liability for CGT.

Proposal:

Amend the UTT legislation to require notification of CGT legal interpretation uncertainties that result in a £5 million, or more, tax advantage.

Question 16: Do you agree with the due date for notification involving CGT to be when a return covering that transaction would otherwise be due, or do you prefer a single due date for all UTT notifications (refer section 4.4)?

Question 17: Can you foresee any practical issues with including CGT within scope of UTT?

4.2.5. Inheritance Tax (IHT)

The government is exploring whether there is a case for bringing certain Inheritance Tax (IHT) legal interpretation uncertainties within the scope of UTT. This section seeks views on the potential benefits, challenges and feasibility of doing so.

The Inheritance Tax gap is 3.9% of the theoretical Inheritance Tax liability, or £0.3 billion in absolute terms, in 2023 to 2024. As with other taxes, some legal interpretation issues can arise within IHT and there may be circumstances where earlier visibility of legal uncertainties could support more consistent treatment and provide greater clarity to taxpayers and HMRC.

Only uncertainties generating a potential tax advantage of £5 million or more would be notifiable, and we expect such cases to be very limited. We therefore welcome views on whether extending UTT to IHT would be a proportionate and appropriately targeted approach.

A further point to consider is the timing of notification. In many situations, the legal interpretation is formed at the tax‑planning stage, whereas the tax outcome may crystallise much later — for example, on death. We also recognise that lifetime transfers, including potentially exempt transfers (PETs) and transfers into trust, may involve planning that ultimately has no tax consequence (for example, where PETs fall outside the 7‑year period). We are therefore particularly interested in views on whether it would be workable or meaningful for UTT to apply at a point other than death, and how unnecessary or disproportionate notifications could be avoided.

We are aware of previous challenges in designing disclosure obligations for IHT, and would welcome input on any potential challenges.

Question 18: Do you agree with the due date for notification involving IHT to be when the IHT return is due, or do you prefer a single due date for all UTT notifications (refer section 4.4)?

Question 19: Do you foresee any practical issues with including Inheritance Tax within the scope of UTT, particularly regarding the timing difference between when a legal interpretation is made and when notification would be required? If so, how do you think these issues could be overcome?

Question 20: Are there specific scenarios where applying UTT would be inappropriate, duplicative or unnecessary? If so, how could an approach be designed to avoid unnecessary notifications while still capturing relevant legal uncertainties?

4.3. Additional notification requirements

UTT was introduced to help reduce the legal interpretation portion of the Tax Gap by requiring selected uncertain legal interpretations to be notified to HMRC. A legal interpretation is considered ‘uncertain’ and therefore notifiable, where one or both of the existing criteria (triggers) are met. These triggers are:

If a provision has been recognised in the accounts of the company or partnership to reflect the probability that a different tax treatment will be applied to a transaction to which the amount relates (para.10(2) of Schedule 17 to Finance Act 2022 (the Act)
if the tax treatment applied in arriving at the amount relies (wholly or in part) on an interpretation or application of the law that is not in accordance with the way in which it is known that HMRC would interpret or apply the law (para.10(3) of the Act)

During policy development, the proposed 7 triggers were reduced to 3, and the third trigger was not pursued when the Finance Bill was introduced. The third trigger was one that required notification where there is a substantial possibility that a tribunal or court would find the treatment to be incorrect in one or more material respects. This was not pursued at that time because it was considered too subjective.

Now that the regime has been embedded for 3 years, the government proposes introducing an additional trigger (or triggers) to require legal interpretation uncertainties to be notified where HMRC’s position is not known and there is more than one credible interpretation. Requiring these uncertainties to be notified will help close the tax gap and increase certainty for the taxpayer.

We want this trigger to capture the spectrum of behaviours that exist in the legal interpretation portion of the tax gap – from genuine uncertainty to speculative interpretations that have a low chance of success, and do not produce the outcome intended when the legislation was enacted.

We want to be notified of legal interpretation uncertainties not currently captured under the existing 2 triggers. These may relate to a new or novel product or process not covered by HMRC guidance, and where no provision is created in the accounts. Under the current rules, such uncertainties would not be notifiable.

Proposal:

We propose introducing an additional trigger that captures the following situation:

there is more than one credible legal interpretation
HMRC’s view is not known

While this option reduces some of the subjectivity involved in determining whether there was a substantial possibility a court or tribunal will find the treatment to be materially incorrect, there will always be an element of judgement when assessing legal interpretations. We consider that this trigger could be effective in identifying the kinds of uncertainties the regime is intended to capture, but it may also generate notifications that are not of direct interest to HMRC.

The government accepts that a large part of the legal interpretation tax gap consists of genuine uncertainty, and not entirely of intentional speculative interpretations.

The government is proposing a trigger that strikes the appropriate balance between clarity and flexibility. Also, acknowledging that refining the trigger to focus the requirement more on identifying uncertainties of interest, unavoidably introduces subjectivity.

The trigger will capture situations where there is a genuine uncertainty and a meaningful risk of challenge, without imposing unnecessary burdens on routine transactions or minor variations. By focusing on cases involving significant tax advantage and material uncertainty, the trigger will aim to ensure that only those interpretations of real concern are brought to the attention of HMRC.

The proposed trigger will link in with the Guideline for Compliance GfC13 — published in September 2025, that helps businesses to file returns with HMRC that are correct and complete.

Currently, the taxpayer only needs to notify a legal-interpretation uncertainty if their tax treatment contradicts HMRC’s known interpretation. HMRC guidance may not exist for new and novel products and processes, meaning this trigger cannot be met. The proposed trigger is intended to address those situations.

As transfer pricing calculations inherently involve a degree of judgement, it is proposed that they are excluded from this trigger. However, they would still fall within scope where either of the existing 2 triggers is met.

Question 21: Do you agree that requiring taxpayers to tell us about legal interpretations where there is more than one credible interpretation and HMRC’s view is not known, will capture the uncertain tax treatments that it is intended to identify?

Question 22: Are there additional triggers that would identify uncertain tax treatments that would not be identified by the proposed trigger, or the existing 2 triggers?

Question 23: In addition to transfer pricing calculations, are there any other uncertainties that should be excluded from the proposed trigger?

4.4. Notification process

4.4.1. Notification due date

Current process

Under the current UTT regime, taxpayers are required to notify HMRC of any arrangements that meet the UTT criteria by submitting a notification aligned to the relevant tax return. This means the timing of the notification depends on which tax (or taxes) the underlying arrangement relates to—for example, notifications connected to Income Tax or Corporation Tax are submitted alongside the relevant annual return.

Recognising future complexity

If the UTT regime were expanded to include a wider range of taxes, this could result in taxpayers having to consider multiple tax heads, each with its own filing timetable. A single UTT arrangement could therefore trigger several separate notifications at different times, depending on the taxes involved.

We recognise that this could create unnecessary burden, increase the risk of missed deadlines, and lead to piecemeal notifications arising from the same underlying UTT.

To reduce complexity and improve consistency for taxpayers and agents, one option is to introduce a single annual UTT notification due date that would be used across all relevant taxes.

This single date would apply solely for UTT purposes and would not change the statutory filing dates for individual taxes, including one‑off taxes such as SDLT, CGT and IHT.

Proposal

The proposal is to introduce a new single annual date by which all UTT notifications must be submitted, regardless of the tax (or taxes) to which the arrangement relates.

We are seeking views on what that date could be, including whether:

aligning with an existing filing deadline (such as Income Tax Self Assessment or Corporation Tax return deadlines) would provide simplicity; or
a separate fixed annual date would give greater clarity and avoid confusion with existing obligations

Question 24: Do you think that having a single annual notification due date would make it easier for taxpayers to comply with the UTT obligation? If so, what date or timing would you consider most appropriate?

4.4.2. Exemption

An exemption from notifying currently exists if it is reasonable for the taxpayer to conclude that HMRC already have available to them all, or substantially all, of the information relating to that amount that would have been included in the notification if it had been required to be given. Further information can be found in the 2022 Finance Act.

The government proposes to tighten this exemption to require the taxpayer to hold confirmation from HMRC acknowledging that the uncertainty has been brought to its attention.

Proposal

For a taxpayer to qualify for the exemption from having notify, due to HMRC having all, or substantially all, of the information relating to the uncertainty, the taxpayer must have confirmation from HMRC that HMRC is aware of the uncertainty.

Question 25: Can you foresee any problems with taxpayers obtaining confirmation from HMRC that the notification has been brought to its attention?

Question 6

5. Assessment of impacts

Accepted Answer

Summary of impacts

Impacts will be completed once the consultation is completed and policy decisions have been made.

Question 7

6. Summary of consultation questions

Accepted Answer

The questions this consultation ask are:

Question 1: Are you responding to this survey as:

a business
a representative body
an organisation
an individual
other (please provide details)

Question 2: Are the views offered in your responses:

your own views
your organisation’s views
your members’ views

Question 3: What is your industry sector (such as accounting, finance, software, retail, construction, other)?

Question 4: To help us determine business size, please provide details on:

number of employees in your business
annual turnover