Latest tax and investment news

Adviser 'deliberate wrongdoing' consultation extension allows for 'mature reflection'

The extension of a consultation on new legislation intended to deter tax planning advisers from 'deliberate wrongdoing' has been welcomed by the Chartered Institute of Taxation (CIOT).

Criticism had been levelled at HM Revenue & Customs (HMRC) for the implications of the draft legislation, which appeared to apply to any advice that could lead to Treasury tax loss, not just illegal actions.

In particular, the CIOT was concerned that an adviser suggesting a client takes out an Isa could be targeted under legislation.

HMRC has since extended the consultation period until April 28th, with CIOT president Andrew Hubbard welcoming the department's quick response to the concerns raised.

He said: "In our opinion, it would have been unworkable and would have created a very damaging rift between HMRC and tax advisers.

"We believe that the extension to the time limit will allow time for mature reflection and result in legislation which is properly targeted, effective and proportionate."

Earlier this week, the CIOT raised concerns about the tax planning implications of personal taxation legislation amendments, announced by financial secretary Stephen Timms.

Under the proposals outlined on February 9th, changes to tax rules relating to manufactured dividends would apply retrospectively from October 2007.

Posted by Brian de Selby