General Anti-Avoidance Rule

A key feature of the Revenue Scotland and Tax Powers Act 2014 (RSTPA) is the General Anti-Avoidance Rule (GAAR) which allows Revenue Scotland to take counteraction against artificial tax avoidance schemes. This makes it difficult for people to circumvent the requirement to pay tax.

Further information is available from the RSTPA legislation guidance (RSTP8001 - Chapter 8).

The RSTPA includes two definitions of ‘artificiality’ to make the Scottish approach to tax avoidance as comprehensive as possible. Revenue Scotland can take counteraction where either (i) a tax avoidance arrangement is not a reasonable course of action having regard to the principles and policy objectives on which the relevant tax legislation is based; or (ii) where the arrangement lacks economic or commercial substance. The Act also sets out a number of indicators of lack of commercial substance.

Tax fraud (effectively tax evasion) is a common law criminal offence in Scotland.

Last updated: 
31 May 2017

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Updated date: 2015-03-30 11:26
Version ID: 423
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