Loans from EBTs and other Trusts

[TheDandy]

Thanks, glad to have your permission...

But perhaps remember that advice from disinterested, neutral observers who actually understand the mechanics of tax law and the associated politics is something you may need. You haven't even yet twigged that this is a political exercise and nothing to do with recovering monies owed.

Can't argue with that.

[TheDandy]

That's correct we are not involved because I knew enough years ago to know that any scheme has the potential to fail and I couldn't accept the risk.. And yes I'm not the cheery poster you want who says don't worry HMRC have made a big mistake everything will be fine. Because as I hope you would of noticed by now HMRC want the money they think is theirs and will do virtually anything to scare people into paying it (that after all is the purpose of the Settlement letters sent to arrive on a Saturday so people can't do anything but worry for 2 days over the weekend)..

I do think it is worth popping up in here once in a while to explain to new posters what is going on now and why the information at the beginning of these threads (which have been going on for 18 months) may not be relevant to them as that relates to a different series of letters. But as you seem to be willing to take over that job please go ahead and explain what the purpose of the current settlement letters are, what the original letters from February 2013 were, how they differ and what people should do...

Can't argue with that.

[davedavis]

Thanks, glad to have your permission...

But perhaps remember that advice from disinterested, neutral observers who actually understand the mechanics of tax law and the associated politics is something you may need. You haven't even yet twigged that this is a political exercise and nothing to do with recovering monies owed.

What sanctimonious claptrap! You love it

[cojak]

Well these settlement opportunity letters are now hitting people's doormats, but there is an interesting article in Out-law.com:

Use of APN power could backfire on HMRC, says expert

HMRC's use of the new power is designed to strong-arm users of avoidance schemes into paying up, but it doesn't take account of the likely behavioural response of risk-taking taxpayers. HMRC assumes many will meekly fall into line. That is not likely, and it will only take a small proportion of them resisting to throw HMRC's entire operation off track.

[malvolio]

What sanctimonious claptrap! You love it

No, I don't. I think you have all been put into an impossible situation on the back of a combination of your own naivety, other people's sharp practices and the merging of avoidance with evasion by the politicos for their own purposes. The least you can do now is listen to what you're being told; if you had done that some time ago you wouldn't be in this position now.

Still, clearly no point arguing with those who don't hear, you carry on; I'm sure everything will turn out for the best. But perhaps you should all have a read of this

[cojak]

Thanks, glad to have your permission...

But perhaps remember that advice from disinterested, neutral observers who actually understand the mechanics of tax law and the associated politics is something you may need. You haven't even yet twigged that this is a political exercise and nothing to do with recovering monies owed.

Well you don't have mine, so I'll move this little flame war to the appropriate thread. You can bitch at one another to your heart's content here.

[LandRover]

Well these settlement opportunity letters are now hitting people's doormats, but there is an interesting article in Out-law.com:

Use of APN power could backfire on HMRC, says expert

Next move is now what do the scheme providers advise now?

I suspect litigation is already being lined up, and as stated if this now becomes tactical then it only takes 10-20% to seriously affect the administration of HMRC avoidance dept, and anything higher would have serious consequences to HMRC normal operations.

[malvolio]

Well you don't have mine, so I'll move this little flame war to the appropriate thread. You can bitch at one another to your heart's content here.

Don't care, I'm out.

[Rob79]

Next move is now what do the scheme providers advise now?

I suspect litigation is already being lined up, and as stated if this now becomes tactical then it only takes 10-20% to seriously affect the administration of HMRC avoidance dept, and anything higher would have serious consequences to HMRC normal operations.

I think I would make a couple of observations that I hope would be uncontroversial.

Firstly, HMRC settlement letters are part of a tried and trusted route for them. Their plan is to raise queries and throw the kitchen sink at schemes that they find "offensive". (Often a subjective assessment and sometimes (but rarely) one that a Court does not agree with.) Once the discussion phase is out of the way, they move towards litigation. The pace at which they do this varies depending on how they rate their chances of winning. Nobody involved in the process believes that HMRC has any interest in advancing cases that they may lose.

Once that is underway the settlement letter appears. If history is to repeat itself, these offers are withdrawn once a decision is reached as HMRC argue that they have to abide by the decision. Obviously taking up the offer then exempts you from the outcome of the decision, good or bad.

Secondly, HMRC considers that in many cases the scheme providers remain the best conduit to reach a settlement. This is in the belief that the providers have their clients' best interests at heart and some motive to bring as many as possible to the table.

I would question that assumption. A scheme that has failed or is in danger of failing is a cash pit for a provider. They have to fund expensive litigation with no guarantee of success. They have probably already spent the initial fees which were in any event driven to a relatively low level as schemes became commoditized and their "unique" properties were copied all around the market. The provider therefore has little profit incentive to continue and maintaining the scheme database, mailing out the offer, collating responses and giving advice all costs money.

It may be that some providers are doing this and perhaps charging for it. In that case they may well have motive. Those who have already gone bust or more ominously gone silent may have no motive.

Probably a subjective question for all involved. Do you trust the scheme provider to act in your best interests? Do you think that they have the requisite skills to do so?

[orientalist]

Loans

If we were to repay the loans to the trust what then? No denying it would be difficult but presumably the tax liability disappears. We could then speak to the trust to see if they have any work they need doing and agree a reasonable rate and vehicle to charge them? Or is this too simplistic?