Tax avoidance schemes

HMRC, as part of its 'Spotlights' updates, has issued warnings on two types of tax scheme:

  • Non-profit-making bodies schemes to obtain VAT exemption for sporting or educational/training supplies, and
  • Business premises renovation allowances schemes. 

The non-profit-making bodies schemes are based on exemptions for VAT that are available where certain sporting and educational/training supplies are provided by a non-profit-making body. The schemes are not new and generally profits made via the scheme are extracted from the non-profit-making body by an associate of the non-profit-making body. HMRC states that it will continue to pursue users of schemes that use this method of extraction of profits. 

Business Premises Renovation Allowances (BPRA) support the regeneration of deprived regions of the UK. They allows investors to claim a tax allowance for 100 per cent of the amount they invest in converting, or renovating, empty business premises. HMRC have highlighted that there are a number of schemes based on this relief and it is undertaking a technical review that will look at ways to stop manipulation of BPRA.