The general anti-abuse rule (GAAR) applies with effect from 17 July 2013 and it is intended to counteract tax advantages that would, ignoring the GAAR, arise from abusive tax arrangements. Note that the Scotland and Wales have their own versions of the GAAR in respect of devolved taxes, see A1.535 (Scotland) and A1.543 (Wales).
For an overview of the GAAR, see A7.411.
The commentary below explains the tax-geared penalties levied when a tax advantage is counteracted under the GAAR. Note that in addition to the GAAR penalty charged on the taxpayer (as discussed below), the promoter or anyone who otherwise enabled the tax arrangements may also be charged a penalty under the penalties for enablers of defeated tax avoidance schemes (see A4.573A).
For a list of the taxes covered by the GAAR and the definition of tax advantage, see A7.411.
The GAAR Advisory Panel referenced in the commentary below is an independent committee that reviews and approves HMRC's guidance on the GAAR. It also provides opinions on individual cases referred to it1. For Panel opinions, see A7.417.
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