Getting Tough on avoidance - Blocking Reverse Annuities


Stopforth D (2005) Getting Tough on avoidance - Blocking Reverse Annuities. British Tax Review, 2005 (5), pp. 557-567.

This article reviews the background to the introduction of section 48 of the Finance Act 1977 (now section 125 of the Income and Corporation Taxes Act 1988 (ICTA 1988)), an anti-avoidance provision aimed at reverse annuity schemes. The focus is not upon a detailed analysis of the section but on the events leading up to its introduction, its underlying policy and discussions that took place behind-the-scenes concerning appropriate drafting to achieve its aims. It is largely based on materials held by the Office of the Parliamentary Counsel to which access was granted despite the papers being less than 30 years old. As a result of the 30-year rule, no materials on this subject are available at The National Archives (Public Record Office). The paper is a case study of the time-consuming way in which the Revenue discovered and dealt with avoidance schemes before the introduction of the disclosure system in the Finance Act 2004.

Annuities; Legal history; Legislation; Tax authorities; Tax planning

British Tax Review: Volume 2005, Issue 5

Publication date31/12/2005
PublisherSweet and Maxwell