Geoff Lloyd's comments on tax avoidance this week at a LexisNexis Tolley conference on the subject are worthy of a wide audience.

Lloyd, director of HMRC's central compliance directorate, announced that HMRC was looking to 'leverage the benefits to advisers of reducing risk for their clients,' i.e. rewarding those who steer clear of tax avoidance.

The idea of rewarding advisers looks a neat idea consistent with HMRC's aim to make avoidance 'not worthwhile', but it looks to be a legal minefield. How can you have as a matter of policy a punishment/reward system for advisers doing things which are perfectly legal, but which you happen to dislike?

He also said that botched avoidance schemes would be treated as negligence, a point that may sting big business, according to some. According to others, the only people they will catch that way are negligent advisers who are most likely already without reputation or credibility.

Lloyd also made some other interesting remarks about avoidance in general.

He admitted, for instance, that there was no single definition of tax avoidance. 'There is no single HMRC definition,' he said.

Avoidance is not paying the right tax at the right time. How can we know what the right tax is then? 'HMRC responds to the intentions of legislation,' he said.

The badges of avoidance include, in particular, the notion of artificiality, he argued, and said HMRC was looking closely in particular at avoidance related to leasing and intangibles.

You have been warned.