Our VAT investigation specialists at Templeton Brook Witt know that taxes is not everyone's favourite topic. However, here's the thing; understanding taxes, especially when it comes to disclosure, can save you a lot of trouble down the road. We’re here to break down the Disclosure of Avoidance Schemes for VAT and Other Indirect Taxes (DASVOIT) in a way that won't make your head spin. DASVOIT came into effect on January 1, 2018, and its goal is to make things clearer and more straightforward. Essentially, it replaced the old VAT Avoidance Disclosure Rules (VADR) and brought along with it, in Templeton Brook Witt’s opinion, some exciting changes.

Any VAT investigation specialist worth their salt, such as Templeton Brook Witt, can tell you that DASVOIT isn't just about VAT anymore. To broadly summarise; DASVOIT revises the list of disclosable VAT schemes, extends disclosure to other indirect taxes and extends the obligation to disclose from users to include promoters. Yes, it's not just taxpayers who need to disclose anymore. Promoters of tax avoidance schemes are in the game too! Due to the nature of DASVOIT, it can be viewed as your one-stop-shop for all things tax avoidance. Templeton Brook Witt’s VAT investigation specialists can help you to make sense of this in depth, should you be a scheme promoter.

The DASVOIT Challenge of Interpretation and Grandfathering

An important aspect of DASVOIT that keeps even experienced VAT investigation specialists on their toes, is what is referred to as “interpretation”. DASVOIT can be similar to a tricky riddle sometimes; it tries to make things clear, but there's still some room for interpretation. Templeton Brook Witt can help you solve the DASVOIT puzzle! Additionally, just to keep things interesting, it introduced something called "grandfathering." This is a way of saying, "If you did this before January 1, 2018, you're off the hook." Sounds great, right? However, it’s not really as straightforward as you would hope. The rules, as well as interpretation, should be closely adhered to.

Here is where it can pay to have VAT investigation specialists, such as Templeton Brook Witt, in your corner. There are grandfathering provisions, stipulated in VAT Notice 799, such that no disclosure is required under the new rules where ones of the following occurs before 1 January 2018:



• A promoter has made a firm approach to another person in relation to the proposal; or
• A promoter makes the proposal available for implementation by any other person; or
• The promoter first becomes aware of any transaction forming part of the arrangements implementing the proposal

Templeton Brook Witt’s VAT investigation specialists use certain measures to interpret the meaning of what counts as "substantially the same", although the law is not entirely clear. 

The Transition Game and Notifiable Arrangements 

At Templeton Brook Witt, we understand that DASVOIT also has transition provisions. Imagine you have some arrangements from before January 1, 2018, and some after. The rules for disclosure are different, and it's a bit like juggling oranges and apples. Understanding when and how to disclose under both DASVOIT and VADR for these mixed arrangements can feel like a tax acrobatics act. Furthermore, at the heart of it are notifiable arrangements. Under DASVOIT, an arrangement is "notifiable" if it ticks three boxes. It has to fall under certain categories; it should help someone get a tax advantage related to taxes like VAT. Additionally, the main benefit of this arrangement should be getting that tax advantage.

In conclusion, there are a few key takeaways from understanding the implications of DASVOIT. This includes that understanding your disclosure obligations, keeping good records, and staying updated on tax rules is essential. Furthermore, teaming up with VAT investigation specialists such as Templeton Brook Witt can help you to simplify your VAT and tax returns. As tax planning evolves and goes digital, we might see more changes in tax disclosure. Templeton Brook Witt is committed to staying ahead of the curve and up to date on the latest legislative changes. If you are in need of our expert tax investigation specialists, don’t hesitate to reach out to us today!