On 15 January 2020, HMRC updated its guidance on sections 75A to 75C, Finance Act 2003 (see SDLTM0950).
Section 75A was introduced in 2006 in response to certain arrangements that sought to reduce, or eliminate, a charge to tax in a manner which was considered by HMRC to be contrary to the intention of Parliament.
Section 75A had previously been understood to be an anti-tax avoidance provision to be applied in circumstances where taxpayers had deliberately participated in transactions intended to avoid tax. However, following Project Blue Ltd v HMRC  UKSC 30 and Hannover Leasing v HMRC  UKFTT 262 (TC), the guidance has been updated so that, if the terms of section 75A are met, it applies regardless of motive.
Although taxpayers will be pleased that these long-awaited changes have been made, uncertainty over the application of section 75A to transactions involving multiple steps remains, especially following removal from the manual of HMRC’s statement that it does not consider section 75A to apply to appropriately taxed transactions. Given the scope of section 75A, its severity and HMRC’s view that no avoidance motive is required, it is likely that HMRC will seek to rely on the section more than it has done in the past.