The Exchequer Secretary to the Treasury (Mr David Gauke)
The business premises renovation allowances (BPRA) scheme provides 100% capital allowances for the capital costs of converting or renovating empty business property in certain disadvantaged areas of the UK, where the property has lain empty for at least a year, in order to bring the premises back into business use.
The Government remain committed to the objectives of BPRA, which is to foster the regeneration of deprived areas, by helping to increase private investment, enterprise and employment in deprived communities.
HM Revenue and Customs (HMRC) has, however, brought to the Government’s attention a recent increase in DOTAS (disclosure of tax avoidance schemes) disclosures, involving BPRA, which appear to contain features aimed at exploiting the relief in ways that Parliament had not intended.
The Government are fully committed to tackling tax avoidance to ensure the Exchequer is protected and fairness is maintained for the taxpayer.
The Government have, therefore, authorised HMRC to conduct a technical review of the BPRA legislation, with a view to making its policy purpose even clearer, so that the scheme may be made simpler and more certain in its application, at the same time reducing the risks of exploitation.
HMRC will shortly be publishing this technical review, along with an associated “Spotlight” article to alert people to the fact that almost all of the disclosed BPRA schemes appear to be seriously flawed and that HMRC will investigate anyone using them.
The technical review will invite comments on new legislative proposals, with a view to introducing new legislation in 2014.