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HMRC internal manual

Capital Gains Manual

Share exchange: anti-avoidance: clearance prevents TCGA92/S137 applying


Once clearance has been granted, or a refusal overturned by the First-tier Tribunal, the anti-avoidance provisions of TCGA92/S137 can only be used to prevent TCGA92/S135 from applying where the clearance is void under s.138(5).

The legislation provides that a clearance notification is void if the information in the application and any further particulars that have been requested about the transaction or transactions do not fully and accurately disclose all material facts and considerations relevant to making the decision.  TCGA92/S138(5).

Clearance is given on the understanding that the person has come to HMRC with “all cards face up on the table”.  In particular an applicant should not consider that information previously supplied to another part of HMRC has been disclosed for the purposes of the clearance application.

There is no provision for “voiding” a clearance.  Whether a clearance is, or is not, effective is ultimately a question of fact that would, ultimately, be determined by the Tribunal.

Where a clearance is void HMRC is free to apply, if appropriate, the relevant anti-avoidance provision.

If you consider that TCGA92/S137(1) is in point please refer this to the Capital Gains Technical Team, before challenging such clearances.