Income Tax (Trading and Other Income) Act 2005 section 6A

Arrangements for avoiding tax

Section 6A provides an anti-avoidance rule that allows HMRC to counteract tax advantages obtained through arrangements where one of the main purposes is to gain an income tax advantage, including advantages derived from double taxation treaties.

• Where a person enters into an arrangement with a main purpose of obtaining a relevant income tax advantage, that advantage must be counteracted through adjustments
• The rule extends to advantages obtained through double taxation treaties, but only where the advantage is contrary to the object and purpose of those treaty provisions
• Adjustments can be made by HMRC or by the taxpayer themselves, through assessments, modifications, amendments, disallowance of claims, or other means
• A "tax advantage" is broadly defined to include reliefs, repayments, avoidance or reduction of charges, deferral of payments, and avoidance of obligations to deduct or account for tax