DOTAS Disclosure Requirements for Stamp Duty
Understanding your obligations under the Disclosure of Tax Avoidance Schemes (DOTAS) regime for stamp duty land tax arrangements and the consequences of non-compliance.
In this article
What is DOTAS?
The Disclosure of Tax Avoidance Schemes (DOTAS) regime requires promoters and users of certain tax avoidance schemes to notify HMRC. This early disclosure allows HMRC to investigate and, if necessary, close down avoidance schemes quickly.
DOTAS applies to stamp duty land tax (SDLT) arrangements that meet specific hallmarks indicating they may be designed primarily to avoid tax. The regime has been significantly strengthened over recent years, with the Finance Bill 2026 proposing further restrictions on scheme promotion.
Key Purpose
DOTAS is not a penalty for using avoidance schemes, but a disclosure requirement that allows HMRC to monitor and challenge arrangements they consider abusive or artificial.
Who Must Disclose?
Promoters
- •Primary duty: Anyone who designs, organises or manages a notifiable scheme
- •Deadline: Within 5 days of making the scheme available for implementation
- •Includes: Tax advisers, accountants, lawyers, banks offering structured arrangements
- •Obligation: Provide SRN to all users within prescribed timeframe
Users (Taxpayers)
- •Secondary duty: Applies when no promoter disclosure made
- •Deadline: On the SDLT return for the transaction
- •Requirement: Include SRN on return or notify if no SRN provided
- •Risk: Penalties for failure to disclose or include SRN
DOTAS Hallmarks for SDLT
A scheme must be disclosed if it meets one or more hallmarks. These are features that indicate a scheme may be primarily designed to avoid tax:
1. Premium Fee Hallmark
The promoter charges a fee that is to a significant extent attributable to the tax advantage. This includes contingency fees based on tax saved or success-based pricing structures.
2. Confidentiality Hallmark
The promoter imposes confidentiality obligations on users that prevent disclosure of how the scheme works to HMRC or other tax advisers. Legitimate commercial confidentiality is excluded.
3. Standardised Tax Products
The scheme is standardised in presentation or structure so it can be used by multiple users without significant modification. Mass-marketed arrangements typically meet this hallmark.
4. Loss Schemes
Arrangements that generate losses or involve loss creation mechanisms that exceed economic substance or commercial rationale.
5. Leasing Arrangements
Complex leasing structures involving stamp duty deferral or avoidance through artificial fragmentation of ownership or multiple intermediary entities.
Scheme Reference Number (SRN) Process
When a scheme is disclosed, HMRC issues a unique Scheme Reference Number (SRN) that must be included on all relevant tax returns.
Promoter Disclosure
Promoter submits AAG1 form to HMRC within 5 days of making scheme available
SRN Issued
HMRC reviews disclosure and issues 8-digit SRN (format: 1XXXXXXX)
SRN Distribution
Promoter must provide SRN to all users within prescribed timeframe
User Reporting
Users include SRN on SDLT return (SDLT1 form, box 58) when filing
HMRC Monitoring
HMRC tracks scheme usage and may open enquiries or challenge arrangements
Important Note
Having an SRN does not mean HMRC approves or accepts the scheme. It is simply an administrative number for tracking purposes. HMRC may still challenge the tax treatment.
DOTAS Landscape: Before & After April 2025
| Aspect | Before April 2025 | After April 2025 |
|---|---|---|
| Nil-rate band | £250,000 | £125,000 |
| Higher rate surcharge | 3% | 5% |
| DOTAS requirements | Active disclosure regime | Tightening enforcement |
| Finance Bill 2026 | N/A | Proposes prohibition on promotion of certain avoidance schemes |
| Promoter penalties | Up to £1m | Up to £1m (unchanged but more actively enforced) |
| User disclosure | On SDLT return | On SDLT return (unchanged) |
Context: While core DOTAS obligations remain stable, the April 2025 SDLT changes (lower nil-rate band, higher surcharge) create greater incentive for taxpayers to seek avoidance arrangements, prompting HMRC to intensify monitoring and enforcement activity.
Penalties for Non-Disclosure
Promoter Penalties
Initial Penalty
- •Up to £600 per day for ongoing failure
- •Maximum £1 million for serious or deliberate breaches
Additional Consequences
- •Conduct notice requiring future disclosure of all schemes
- •Monitoring notice subjecting promoter to enhanced scrutiny
- •Publication of promoter details on HMRC website
- •Reputational damage affecting professional standing
User Penalties
For Failure to Disclose
- •£5,000 initial penalty
- •£600 per day for continued failure after initial penalty
For Failure to Provide SRN
- •£5,000 for not including SRN on tax return
- •Extended enquiry window (up to 20 years for deliberate non-disclosure)
Tax Consequences
- •Tax advantage likely to be challenged and denied
- •Interest on underpaid tax from transaction date
- •Potential inaccuracy penalties if return incorrect
Finance Bill 2026 Reforms
The Finance Bill 2026 proposes significant strengthening of anti-avoidance measures, building on the DOTAS framework with more proactive intervention powers.
Prohibition on Scheme Promotion
HMRC will gain power to issue prohibition notices preventing promoters from marketing schemes HMRC considers abusive, even before litigation confirms the tax treatment.
- • Fast-track process for stopping harmful schemes
- • Criminal sanctions for breaching prohibition notices
- • Applies to SDLT avoidance schemes meeting specific risk criteria
Enhanced Penalties
Increased penalties for enablers of defeated tax avoidance, extending beyond promoters to advisers, introducers and facilitators.
- • Penalties based on fees received from arrangement
- • Joint and several liability for all enablers
- • Public naming of enablers on HMRC website
Accelerated Payment Notices (APNs)
Expansion of APN regime to require upfront payment of disputed SDLT while scheme is under enquiry or litigation.
- • Payment due within 90 days of notice
- • No right of appeal against payment requirement
- • Refunded with interest if scheme ultimately successful
Effective Date
Most Finance Bill 2026 provisions are expected to take effect from Royal Assent (estimated summer 2026), with some measures having retrospective effect to scheme entries from April 2025 onwards. Check HMRC guidance for specific commencement dates.
How to Check if a Scheme Needs Disclosure
For Taxpayers
- 1.Ask your adviser or promoter directly if the arrangement is DOTAS-notifiable
- 2.Request the SRN before entering the arrangement
- 3.If no SRN provided but arrangement seems artificial or aggressive, seek independent advice
- 4.Consider whether the main purpose is tax saving rather than commercial benefit
- 5.Check HMRC's "Spotlights" page for published avoidance schemes to avoid
For Advisers/Promoters
- 1.Review arrangement against all DOTAS hallmarks systematically
- 2.Consider substance over form - does arrangement have commercial purpose beyond tax?
- 3.If in doubt, seek clearance from HMRC or make protective disclosure
- 4.Document analysis of why arrangement is/is not notifiable
- 5.Be aware penalties for failure to disclose are severe and strictly enforced
HMRC Resources
- •Spotlights: Published warnings about specific avoidance schemes HMRC is challenging
- •DOTAS guidance: Detailed technical guidance on disclosure obligations (HMRC manuals ARTG)
- •Avoidance helpline: 0300 200 3300 for queries about specific arrangements
- •Online services: Submit disclosures and view SRNs through HMRC online account
Calculate Your Legitimate Stamp Duty
Avoid risky avoidance schemes. Use our accurate calculators to understand your real SDLT liability and plan accordingly with legitimate tax-efficient strategies.
Emma Richardson, MRICS
Chartered Surveyor & Property Tax Specialist
Emma Richardson is a RICS-qualified Chartered Surveyor with over 12 years of experience in UK property taxation. She founded Stamp Duty Calculator to help buyers understand the complex world of property transaction taxes.