New rule in force for Tax Avoidance

The long awaited general anti-abuse rule (GAAR) came into force on 6 April.  The general message is that avoiding tax by making the most of the rules is still alright, but taking steps which are artificial or abnormal and are mainly used to escape tax can be caught by the GAAR.  The tax saved can be clawed back and large penalties charged.

The difficulty is, what you feel is a fair avoidance may not be what your local tax inspector feels.  This is where the latest guidance on the GAAR may come in useful and although it is lengthy it gives clear examples and explanations of where the GAAR can apply.