The 2014 Finance Act gave HMRC significant new powers to demand upfront payment of disputed tax from taxpayers using avoidance schemes. This is facilitated by the use of an Accelerated Payment Notice (APN) when HMRC have an open appeal or enquiry and either:

• the taxpayer is using certain arrangements disclosed under the disclosure of tax avoidance scheme (DOTAS) rules or
• the recipient is subject to a counteraction notice under the General Anti-Abuse Rule (GAAR).

HMRC has now published an update that confirms that 30 scheme users were notified in August 2014 that they had 90 days to pay a total of around £29 million of disputed tax upfront under the APN regime. Over 99% of this money was paid within the deadline.

Financial Secretary to the Treasury David Gauke said:

'The high success rate for the first set of Accelerated Payments Notices shows avoidance scheme users are having to face up to the reality that they should pay their tax upfront, like the vast majority of taxpayers. As we move into 2015 and HMRC ramps up the number of notices it sends out, thousands more will get the message that Accelerated Payments has changed the economics of tax avoidance.'

To date, HMRC has issued over 1,750 APNs, to the value of £400 million. The vast majority of those notices have not reached the 90 day payment deadline. HMRC has stated that going forward they will be issuing 2,500 APNs per month.