Summary and Background Follower notices and accelerated payments
15.The Government confirmed at Autumn Statement 2013 that it would introduce a new measure where HMRC would send a ‘follower notice’ to users of avoidance schemes that have failed in another party’s litigation, setting out HMRC’s view that they should settle their tax dispute. If they decide not to settle the dispute they would risk a penalty.
16.The Government also announced at Autumn Statement that a taxpayer who chose not to settle on receipt of a follower notice would be required to make an accelerated payment of the tax in dispute.
17.The consultation paper Tackling marketed tax avoidance was published on 24 January 2014. It set out the proposals and draft legislation for the further stages of the accelerated payment measures.
18.A follower notice sets out HMRC’s view that a judicial decision determines a taxpayer’s case and will invite them to settle their case. They will face a tax-geared penalty if they unsuccessfully continue with their case and cannot show either it was materially different from the other party’s litigation or that they had reasonable grounds to continue the dispute.
19.Accelerated payments may be required from taxpayers in the following circumstances:
	Where a follower notice has been issued and the taxpayer decides not to settle their dispute;
	Where taxpayers are involved in schemes subject to disclosure under the Disclosure of Tax Avoidance Schemes (DOTAS) rules; or
	Where taxpayers have used arrangements that HMRC decides to counteract under the General Anti-Abuse Rule (GAAR), and where the Advisory Panel gives its opinion that the arrangements are not a reasonable course of action.
20.This Act applies the Finance Act 2014 (FA 2014) provisions to NICs ensuring that there is a single follower notices regime and accelerated payments regime for tax and NICs.