Compliance
Compliance Spotlight: Extending Uncertain Tax Treatment Notification for Larger Scope
HMRC proposes to widen ‘Uncertain Tax Treatment’ regime to include individuals, trusts and additional taxes—a vital compliance development for anyone in high risk areas.
By NomadicTax Research Team • 5-8 min read • March 16, 2026
## What is the UTT regime?
UTT (Uncertain Tax Treatment) is a UK regime introduced in 2022 requiring **large businesses** to notify HMRC when they use tax treatments or interpretations that might differ from HMRC’s published view or where HMRC’s view is unclear. This aims to reduce legal interpretation risk and improve tax certainty. ([gov.uk](https://www.gov.uk/government/consultations/consultation-extend-notification-of-uncertain-tax-treatment-utt-regime/opportunities-to-extend-uncertain-tax-treatment?utm_source=openai))
## Proposed changes in early 2026 consultation
A consultation **published 4 days ago** sets out proposals to extend the UTT regime. Key proposals: ([gov.uk](https://www.gov.uk/government/consultations/consultation-extend-notification-of-uncertain-tax-treatment-utt-regime/opportunities-to-extend-uncertain-tax-treatment?utm_source=openai))
- Bring **individuals and trusts** into the scope of UTT
- Add further taxes like **Stamp Duty Land Tax (SDLT)**, **National Insurance Contributions (NICs)**, **Construction Industry Scheme (CIS)**, **Inheritance Tax (IHT)**, and **Capital Gains Tax (CGT)**
- Introduce additional triggers for notification beyond current thresholds
- Legislation expected in the **next available Finance Bill**, applying from returns filed **after 1 April** of the following year ([gov.uk](https://www.gov.uk/government/consultations/consultation-extend-notification-of-uncertain-tax-treatment-utt-regime/opportunities-to-extend-uncertain-tax-treatment?utm_source=openai))
## Compliance implications and good practice
For organizations, individuals, and trusts, this expansion means increased risk and need for governance. Here’s how to stay ahead:
- **Audit existing tax positions** where ambiguity exists—especially those touching CGT, IHT, SDLT etc.—and document the rationale.
- **Track interpretation uncertainties**: maintain internal logs of tax positions where HMRC’s published guidance is unclear or absent.
- **Set internal thresholds and policies** for when to escalate to UTT notification.
- **Seek expert legal/tax advice** before relying on aggressive or novel tax positions.
## Example scenario
A family trust holds UK residential property and claims RELIEF under some ambiguous rules for SDLT. Under proposed UTT extension, trustees may need to notify HMRC of the uncertainty—even if, previously, only companies would have done so. Missing this could mean penalties or loss of mitigation.
## Action steps before and after enactment
1. **Review tax returns and forecasts** – identify where new taxes would trigger UTT notification (e.g. upcoming CGT disposals, SDLT property acquisitions)
2. **Update governance & controls** – add review checklists, establish responsibility for reviewing uncertain positions
3. **Ensure advisers are aware** of notification obligations; when applicable, get opinion or confirmation that treatment is HMRC-aligned or defensible
4. **Monitor legislation**—watch for the draft Finance Bill and regulations, expected timing and clarity around “trigger points” and thresholds
These compliance developments underscore HMRC’s increasing focus on early visibility and consistency in tax interpretations. Whether you’re don’t-for-profit, trust, individual, or company—transparency and preparation will be essential.