The CIOT has responded to HMRC’s consultation on the mandatory disclosure rules (MDR) regime which would require the disclosure of certain arrangements and structures which could facilitate tax evasion to HMRC. The consultation followed the announcement at autumn Budget 2021 that the UK government intended to implement the OECD’s Model mandatory disclosure rules for CRS avoidance arrangements and opaque offshore structures.
Welcoming the aims of the regime, the CIOT also notes a number of concerns:
Rules requiring disclosure of common reporting standard (CRS) avoidance arrangements going back to 29 October 2014 will introduce a ‘disproportionate administrative burden on business in relation to the perceived benefits to HMRC’.
The seven or eight-year look-back requirement will present significant practical challenges, with the only way to mitigate the associated burdens being to bring forward the start date, perhaps to coincide with the DAC6 date of 25 June 2018.
The CIOT does not support the proposed look-back period, particularly given that businesses are not required to retain records beyond a six-year period and, even where they do, are likely to have undergone significant change over that period.
The CIOT has responded to HMRC’s consultation on the mandatory disclosure rules (MDR) regime which would require the disclosure of certain arrangements and structures which could facilitate tax evasion to HMRC. The consultation followed the announcement at autumn Budget 2021 that the UK government intended to implement the OECD’s Model mandatory disclosure rules for CRS avoidance arrangements and opaque offshore structures.
Welcoming the aims of the regime, the CIOT also notes a number of concerns:
Rules requiring disclosure of common reporting standard (CRS) avoidance arrangements going back to 29 October 2014 will introduce a ‘disproportionate administrative burden on business in relation to the perceived benefits to HMRC’.
The seven or eight-year look-back requirement will present significant practical challenges, with the only way to mitigate the associated burdens being to bring forward the start date, perhaps to coincide with the DAC6 date of 25 June 2018.
The CIOT does not support the proposed look-back period, particularly given that businesses are not required to retain records beyond a six-year period and, even where they do, are likely to have undergone significant change over that period.
