Tailor your return 27 - Tax avoidance schemes

If you've used one or more tax avoidance schemes in 2020 to 2021, select 'Yes', otherwise select 'No'.

If you've used a scheme or arrangement to obtain a tax advantage, or expect to obtain a tax advantage at some point, you're required to report to HMRC the tax year in which the expected advantage arises in this section.

For example, if a tax or National Insurance contributions advantage arose in the 2019 to 2020 tax year, show 2019 to 2020. If no tax advantage arose but an advantage is expected to arise in a later year, show the earliest future year in which that advantage is expected to arise, for example, 2020 to 2021. If you included it in a previous tax return, you must carry on reporting it until there is no tax advantage, for example, until all losses from the scheme have been used up.

You should choose 'No' if you're an employer and the notifiable arrangements concerned are arrangements connected with employment of employees. The obligations of the employer when completing their own tax return are different and requires them to use a separate form for reporting any schemes involving the income tax or National Insurance contributions position of employees. A scheme reference number for notified arrangements connected with the employment of employees should be reported separately using form AAG8 Tax avoidance schemes: disclosure of details about employees in relation to avoidance schemes.

Tax advantage here means:

• relief or increased relief from, or repayment or increased repayment of, income tax or capital gains tax, or the avoidance or reduction of a charge to that tax or an assessment to that tax or the avoidance of a possible assessment to that tax
• the deferral of any payment of tax or the advancement of any repayment of tax
• the avoidance of any obligation to deduct or account for any tax
• for National Insurance contributions purposes, the definition potentially applies to all classes of National Insurance

If you fail to report a scheme or arrangement to obtain a tax advantage that you're required to report, you'll have to pay a penalty. For more information, go to Disclosure of tax avoidance schemes.