UK clarifies boundaries of ban on promoting ineffective tax-avoidance arrangements

Finance Act 2026 section 159 prohibits promoting arrangements marketed, or likely to be marketed, for a particular tax advantage where there is no realistic prospect of achieving it. It also covers arrangements specified in HMRC regulations. Those regulations require HMRC reasonably to consider that the marketed advantage is unlikely and participants are likely to be harmed. The guidance does not announce a new October tax charge or a general prohibition on disputed tax advice.^[1][2]

Under section 160, promotion includes encouraging implementation, making arrangements available, organising or managing implemented arrangements, or arranging for others to do so, in business or for monetary gain. Merely supplying goods or services commercially is excluded where the supplier neither knows nor could reasonably be expected to know of their use for prohibited arrangements. Merely providing legally privileged advice or information is also excluded; this is not an exemption for every professional communication.^[2]

HMRC gives the example of a bank not becoming a promoter simply because a promoter holds an account and participants’ money passes through it. It also says filing a return alone is not promotion where the agent has no relationship with the promoter or other involved parties. Businesses and advisers should therefore distinguish routine services from participation in implementation, rather than infer exposure solely from serving a scheme user. The guidance cautions that a service provider may still receive a Promoter Action Notice where its customer is or becomes a certified promoter.^[1][2]

Section162 permits civil penalties up to £1 million plus £5,000 per participant, with an authorised officer required to allow 30 days for representations before imposing one. Sections163–164 create criminal liability, including possible liability of responsible company officers where consent, connivance or neglect is established. Neither group membership nor holding office alone establishes that condition. These are enforcement safeguards and sanctions, not new general tax-return deadlines.^[2]