Explanatory note

The Regulations are made further to the provisions contained in Schedule 17 (“the Schedule”) to the Finance (No. 2) Act 2017 (c. 32). The Schedule makes provision in respect of the disclosure of avoidance schemes, being schemes which enable a person to obtain a tax advantage (defined in paragraphs 6 and 7 of the Schedule), concerning VAT and other indirect taxes (a list of indirect taxes to which the Schedule applies is set out at paragraph 2(1) of the Schedule). Regulations may be made under the Schedule to prescribe notifiable arrangements. Information in relation to such arrangements must be notified to HMRC. The Indirect Taxes (Disclosure of Avoidance Schemes) Regulations 2017 provide for the information to be notified.

Regulation 2 contains definitions used in the Regulations.

Part 2 of the Regulations prescribes notifiable arrangements in relation to VAT.

• Regulation 4 prescribes arrangements in respect of supplies to a retail customer, where what would be a single supply is split into separate supplies.

• Regulation 5 prescribes arrangements concerning certain supplies, which are or would be exempt, made by a person in the United Kingdom to a person who belongs outside the EU and that person makes an exempt supply to a person in the EU. Indirect supplies between these persons are included within the prescribed arrangements.

• Regulation 6 prescribes arrangements concerning a supply of services made by a person in the United Kingdom to a relevant business person who belongs outside the EU and that person makes a further supply of services to a person in the EU. Indirect supplies between these persons are included within the prescribed arrangements.

• Regulation 7 prescribes arrangements concerning supplies of land or buildings and the disapplication of the option to tax land.

Part 3 of the Regulations prescribes notifiable arrangements in relation to any indirect tax.

• Regulation 9 prescribes arrangements which a promoter might reasonably be expected to keep confidential from HMRC or another promoter.

• Regulation 10 provides a definition of small or medium-sized enterprise which is used in regulation 11.

• Regulation 11 prescribes arrangements to which a person, who is not a promoter, is to be a party or which the person is to use for business purposes and which the person might reasonably be expected to keep confidential from HMRC. An arrangement is not prescribed where the business is a small or medium-sized enterprise.

• Regulation 12 prescribes arrangements where a person might reasonably be expected to obtain a premium fee in relation to the arrangements.

• Regulation 13 prescribes arrangements which have standardised or substantially standardised documentation, there are specific or standardised transactions to implement the arrangements and the main purpose of the arrangements is to obtain a tax advantage or they would not be entered into were it not for that advantage.

A Tax Information and Impact Note covering this instrument was published on 5 December 2016 and made available alongside the Finance (No.2) Bill 2017 and is available on the website at https://www.gov.uk/government/collections/tax-information-and-impact-notes-tiins. It remains an accurate summary of the impacts that apply to this instrument.