What does section 704 of the Income Tax Act 2007 establish?

Section 704 prescribes how the special tribunal that hears cases under the tax avoidance transactions provisions is to be constituted. It establishes the framework for an independent panel to consider whether HMRC is justified in counteracting a claimed tax advantage obtained through certain transactions in the United Kingdom.

What is the role of the special tribunal under the anti-avoidance provisions?

The special tribunal considers cases where HMRC believes a taxpayer has obtained a tax advantage through transactions designed to reduce income tax liability. Before HMRC can issue a counteraction notice, the tribunal reviews the facts and determines whether the proposed counteraction is appropriate under the anti-avoidance provisions.

How were the tribunal functions under section 704 affected by the 2009 Order?

The Transfer of Tribunal Functions and Revenue and Customs Appeals Order 2009 transferred the tribunal responsibilities originally established under section 704 as part of a wider reorganisation. This ensured that tax-related disputes, including those under anti-avoidance provisions, are heard within the unified tribunal structure in the United Kingdom.

What earlier legislation did section 704 of the Income Tax Act 2007 derive from?

Section 704 derives from section 706 of the Income and Corporation Taxes Act (ICTA). It was rewritten into the Income Tax Act 2007 as part of the broader United Kingdom tax law rewrite programme, which aimed to modernise and consolidate existing tax legislation into clearer, more accessible statutory provisions.

Income Tax Act 2007 section 704

The tribunal

Section 704 sets out how the special tribunal that hears cases under the tax avoidance transactions provisions is to be constituted.

A special tribunal is established to hear cases where HMRC seeks to counteract tax advantages from certain transactions
The tribunal's constitution and membership are prescribed specifically for the purposes of these anti-avoidance provisions
The tribunal functions were subsequently transferred under the 2009 Transfer of Tribunal Functions Order
The section derives from the earlier provisions in section 706 of the Income and Corporation Taxes Act

Access full legislation.And much more.

By becoming a member, your team gets full access to Tax World research tools and source-backed tax resources.

Become a member