Nichola Ross Martin reports on the recent debate in the House of Commons over the anti-avoidance draft clause in the 2006 Finance Act dealing with abuse of charity tax reliefs.
The clause in question - 54 'Transactions with substantial donors' - focuses on abuse of charity tax reliefs, particularly where donors make gifts with conditions attached.
In the words of Dawn Primarolo speaking during the Commons debate last week:
"Substantial donors either make payments or transfer assets to charities, and then receive back money, shares or property. Reliefs in the form of gift aid payments or share relief payments are then triggered depending on which of those applies. Having obtained the relief, the donor then gets back a loan that may, for example, carry no repayment schedule with it ' in fact, t...