The Government intends to require large businesses to notify HMRC where they have adopted an uncertain tax treatment. This consultation sets out the framework for that requirement and seeks views on:

• Who is liable to notify
• The size of business that will be required to notify
• The tax threshold requiring notification
• The method of notification
• The level of detail that needs to be notified
• The proposed implementation date.

The deadline for responses is 29 May 2020. The Government will publish its response, along with draft clauses, in late summer 2020. Legislation will be introduced in the 2020 to 2021 Finance Bill and will apply to returns filed after April 2021.

Scope

The requirement will only apply to large businesses. The threshold for what is a large business, and therefore within scope of the notification measure, will be modelled on the:

• Senior Accounting Officer (SAO) regime (Schedule 46 to Finance Act 2009), and
• Publication of Tax Strategies (PoTS) regime (Schedule 19 to Finance Act 2016).

Businesses fall within these regimes if they satisfy either or both of:

• A turnover above £200 million.
• A balance sheet total over £2 billion.

It is intended that the notification measure will apply to partnerships and LLPs that satisfy the above criteria, as well as corporates. In terms of HMRC’s customer segmentation, this population will include all of those handled by Large Business, as well as the larger groups in Mid-Sized Business.  The requirement will be for notifications in respect of Corporation Tax, Income Tax (including PAYE), VAT, Excise and Customs Duties, Insurance Premium Tax, Stamp Duty Land Tax, Stamp Duty Reserve Tax, Bank Levy and Petroleum Revenue Tax. These are the taxes and duties currently in scope of the SAO regime.

CTG has previously secured confirmation that the definition of turnover for the SAO regime nad PoTS regime does not include donations and voluntary income: “Corporates which are charities almost certainly receive donations and other voluntary income which does not derive from the provision of goods and services. This would not therefore constitute turnover”. We will be seeking confirmation that this same interpretation will be applicable to this regime.