The last official word I can find on 'avoidance vs evasion' was by the House of Lords Economic Affairs Committee in their 2013 report on the Government’s proposals for a ‘General Anti-Abuse Rule’ – or GAAR. The Committee cited Mr Gauke’s distinction between avoidance and evasion:
"The Government have not published a definition of avoidance. However it is widely understood to entail taking a view of the tax treatment of a transaction that is tenable but has tax consequences that were not intended by the legislature. This does not prevent taxpayers organising their affairs in an efficient manner, consistent with the intentions of the legislation. Tackling tax avoidance is essential and we make every effort to do so. The Government consider the economic efficiency of tax measures as part of the tax policy-making process."
And the Committee went on to quote the evidence of Ms Judith Knott (then HMRC Director, Corporation Tax International Anti-Avoidance) in her appearance before the Committee:
"What we mean by legitimate tax planning is tax planning that is very much in line with Parliament’s intentions when it passed the rules. A good example would be putting cash into an ISA account. That is legitimate and what Parliament intended to happen. Avoidance, on the other hand, is behaviour that seeks to bend the tax rules in a way that Parliament did not intend. It is often accompanied by artificial transactions—trying to seek a result that was not intended."
Why am I re-hashing this old topic? Because, leaving aside the lack of practical definition provided in those responses from the Treasury and HMRC, the latest issue of HMRC's Agent Update contains the following brief article:
Anyone employed through agencies and umbrella companies should be careful they’re not getting drawn into tax avoidance. Many umbrella companies are compliant with the tax rules but some use tax avoidance schemes.
Tax avoidance schemes do not work, including those that may claim to be tax efficient or offer to increase your take-home pay. They sometimes carry high, non-refundable fees and are often provided by, or through, offshore promoters."
So HMRC appear now to have moved from a fuzzy delineation that they invented (between two 'types' of tax evasion - those in line with and those not in line with Parliament's intentions) ... to a categoric statement that "Tax avoidance schemes do not work", which is demonstrably not true (even if HMRC wish it were so).
Why does this matter? Because in the same way that the stock-market is driven by and dependent on confidence, the operations of tax reporting & collection are dependent on a degree of mutual trust between all the relevant parties. The level of trust in HMRC by taxpayers is already worringly low, and I dread to think what would be the score if you surveyed accountants & agents (even before the advent of MTD for ITSA), so public pronouncements that are (intentionally) wrong will exacerbate the situation ... NOT lead to people going "Oh so that's what HMRC mean, I'd better not use any available avoidance facilities"!