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HMRC internal manual

International Manual

Double Taxation Relief: Anti avoidance legislation: Disputes

If HMRC and the taxpayer disagree about the applicability or the effect of the legislation, the dispute should be settled in the usual way using enquiry procedures. Disputes may arise if the taxpayer contends that:

  • the conditions required to trigger the anti-avoidance legislation are not met - if the taxpayer considers that tax avoidance is not a sole or main purpose of the arrangements described, or because that of the circumstances apply; or
  • the effect of the legislation differs from that proposed by HMRC in the notice

In either case, the taxpayer should explain the reasons for their view and provide information and evidence in support. If, on the basis of the new information provided, HMRC is able wholly or partly to agree with the taxpayer’s contentions, it may accept the self assessment. HMRC may issue a further notice if, based on new information, it takes the view that the legislation should have wider effect than set out in the original notice.

If the taxpayer and HMRC are unable to reach agreement, the dispute may be referred to the First Tier Tribunal in the normal way. The Tribunal will be able to consider all of the arguments advanced by the taxpayer in accordance with the first bullet point above.