Advisers need to be aware of stringent disclosure rules coming in when carrying out inheritance tax planning, Geoffrey Todd has warned.
Mr Todd, a partner in the private client and tax team at Boodle Hatfield, said that the disclosure of tax avoidance scheme (Dotas) regulations – out for consultation until 10 September – could see individuals and their advisers required to disclose participation in all but the most basic of IHT planning.
The rules, first published on 16 July 2015, could require even straightforward arrangements to be disclosed, swamping HMRC with information that they do not want or need.
Mr Todd added: “These proposals have largely gone unnoticed, perhaps overshadowed by the government’s more newsworthy Budget announcements.
“They have been consulted on before and in response the government has suggested it would clarify the scope of the draft regulations, but this has not yet happened.”
Adviser view
David Barton, partner for national taxadvisory firm Baker Tilly, said: “We understand why HMRC wishes IHT to be brought more fully into Dotas.
“However, since IHT is a fundamentally different tax to anything else in the Dotas regime, we believe IHT should be left out of the Dotas rules.”
