Introduction
HMRC has published detailed guidance on its new anti-avoidance information notice powers, introduced by sections 177-208 of the Finance Act 2026.
These provisions represent a significant expansion of HMRC’s ability to obtain information from those it suspects of promoting or facilitating tax avoidance.
The gloves, it seems, are coming off.
The New Powers
The Finance Act 2026 creates a new category of information notice specifically targeted at the avoidance industry. Unlike standard Schedule 36 information notices, these new powers can be issued where HMRC “reasonably suspects” that a person is connected with the promotion or facilitation of tax avoidance arrangements.
The threshold is notable. HMRC does not need to be investigating a specific scheme or have evidence of actual wrongdoing.
Reasonable suspicion of connection to avoidance promotion is sufficient to trigger the power.
Who Can Be Targeted
The powers extend to anyone HMRC reasonably suspects is connected with promotion or facilitation. This includes:
- Promoters: Those who design, market, or make available avoidance arrangements
- Enablers: Those who facilitate the implementation of arrangements, including advisers, accountants, lawyers, and introducers
- Connected parties: Those who assist promoters, including administrators, IT providers, and marketing services
The net is cast deliberately wide.
HMRC’s published guidance makes clear that the power is intended to capture not just the architects of avoidance but the entire ecosystem that supports them.
What Information Can Be Required
An anti-avoidance information notice can require the production of:
- Documents relating to avoidance arrangements
- Information about the arrangements and how they work
- Details of persons involved in designing, promoting, or implementing arrangements
- Client lists and participant information
- Financial information about fees charged and received
Critically, the notice can require information about arrangements that have not yet been implemented, and about arrangements involving third parties. The scope is prospective and extends beyond the recipient’s own tax affairs.
Legal Professional Privilege
Legal professional privilege continues to apply, but its protection is narrower than some might assume. Privilege covers communications seeking or providing legal advice.
It does not protect:
- Communications about the implementation of arrangements (as opposed to advice about their legal effect)
- Marketing materials and promotional documents
- Administrative records and client lists
- Fee arrangements and financial records
The guidance emphasises that privilege cannot be claimed over documents merely because they were created by or sent to a lawyer.
The content and purpose matter.
Penalties for Non-Compliance
The penalty regime for failing to comply with an anti-avoidance information notice is severe.
Initial penalties of up to £300 per day can be imposed. Where HMRC believes non-compliance is deliberate, the daily penalty can increase to £1,000.
Continued non-compliance can result in tax-related penalties calculated by reference to the tax advantage sought.
For promoters, failure to comply can also result in “naming and shaming” which involves the publication of the promoter’s details on HMRC’s list of those who have failed to cooperate.
That reputational damage may exceed the financial penalties.
Appeals and Safeguards
Recipients of an anti-avoidance information notice can appeal to the First-tier Tribunal. The Tribunal will consider whether:
- HMRC had reasonable grounds for its suspicion
- The information requested is reasonably required
- The notice is proportionate
However, appealing does not suspend the obligation to comply.
Unless the Tribunal grants a stay, information must be provided by the deadline while the appeal is determined.
Given Tribunal delays, this creates practical pressure to comply even where the notice is being challenged.
Context – The Crackdown Intensifies
These powers form part of a sustained offensive against the tax avoidance industry. Recent years have seen:
- The Promoters of Tax Avoidance Schemes (POTAS) regime strengthened
- Disclosure of Tax Avoidance Schemes (DOTAS) requirements tightened
- The General Anti-Abuse Rule (GAAR) applied with increasing frequency
- Personal liability extended to directors of corporate promoters
- Naming and shaming of promoters expanded
The anti-avoidance information notice powers plug a gap.
Previously, HMRC could investigate users of avoidance schemes relatively easily but faced more difficulty in obtaining information from promoters before a specific investigation was underway.
These powers shift that balance.
Implications for Advisers
For legitimate tax advisers, the powers should not create direct concern. The guidance emphasises that advice on tax-efficient structures that work within the ‘spirit’ of the law is not avoidance promotion.
However, the broad scope of “facilitation” means that advisers should be cautious about any involvement with arrangements that might be characterised as avoidance.
Introducing clients to promoters, providing opinions that are used in marketing materials, or offering implementation services could all potentially attract HMRC’s attention.
Documentation of the adviser’s own analysis, demonstrating genuine belief that arrangements work within the law, becomes increasingly important. The “reasonable excuse” defence to penalties requires evidence of that reasoning.
For those who have been involved in promoting or facilitating arrangements that HMRC might challenge, these powers represent a significant escalation.
The information HMRC can now demand goes well beyond what was previously available, and the penalties for non-compliance are substantial.
The message from HMRC is unmistakable – the avoidance industry is under sustained assault, and these new powers are another weapon in the armoury.
Those who persist in promoting aggressive schemes should expect increasingly aggressive enforcement in response.