Non-standard Tax Planning and the Inland Revenue

Another announcement by the Chancellor in March 2004 was that there will be greater scrutiny on Tax Planning and constructions from professional companies specialising in tax planning that go outside the normal fiscal planning processes. These tax vehicles will have to be lodged in some form of ledger with the Inland Revenue, presumably to allow them to okay them or challenge them.

The new directive is still rather vague, but one thing is for sure – the Inland Revenue will want to know more about how Tax Planners are reducing tax liabilities for their clients with a view to closing some loopholes they believe may be being abused.

Most Trusts and Company structures are standard and would not have to be lodged – further consultation and clarification on this will take place in the coming year. It is important to understand that any fiscal optimisation suggested by Tax Planning professionals has a chance of challenge and rebuttal if it is a non standard procedure.

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