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E6.437 Double tax relief and anti-avoidance—overview

In addition to the specific anti-avoidance rules for double taxation relief outlined below, the UK has a number of other anti-avoidance rules which may impact double taxation relief. These include the Transfer of assets abroad rules E1.1101 and the Temporary non-residence rules E6.137A. The interaction of these rules can be complex. See, for example, Hoey¹, where the Court of Appeal commented that the Transfer of assets abroad rules should be kept in reserve for deployment in cases of tax avoidance which cannot effectively be countered in any other way.

Double taxation relief has its own targeted anti-avoidance rule (TAAR)². The TAAR prescribes a set of triggering conditions (A to D, described below) leading to an obligation to counter the effects of a scheme falling within condition B (ie an avoidance scheme – see below). Authority is provided for any necessary adjustments to assessments and claims³. Where HMRC considers that conditions have been breached, it will issue a counteraction notice⁴. Such notices may