PAYE140045 | The PAYE discretion at s684(7A)(b) ITEPA 2003 and contractor loans avoidance schemes: contents: insufficient information about the scheme

If the G7 or higher grade Counter Avoidance officer concludes that HMRC does not have sufficient evidence about how the scheme operated to determine that the scheme is a relevant scheme and to make a decision about use of the PAYE discretion, then the PAYE discretion should not be exercised at this time and Counter Avoidance should instead investigate the scheme further.

HMRC may sometimes need to consider use of the PAYE discretion before completing the requisite general fact finding about how the scheme works, for example because of customer-driven litigation. A G7 or higher grade Counter Avoidance officer should refer all of the facts as HMRC knows them to Counter Avoidance Operational Policy for advice before a decision is made about whether or not they should exercise the PAYE discretion in such circumstances.