HMRC Enquiry letters on Loans from EBT and other schemes

[LandRover]

Well worth a read.

http://www.taxation.co.uk/taxation/A...-it-s-all-over

As mentioned in the article, would be nice to see HMRC use some common sense and not appeal Rangers case.

HMRC have their APN weapon, and they want to use it, itchy finger on the trigger, however holding the gun up at us in using Settlement opportunity is pointless, as I can not see the incentive for any past scheme users not to make HMRC work hard for their bullying threats. The big flaw in the settlement opportunity is the lack of incentive. Its clear they don't appear to know what each persons loans were, hence to settle YOU are expected to help them by supplying all the details, HMRC should realise that there is an administration nightmare coming their way. The costs to collect and administer all this will make significant inroads into their dept budgets, and yet if they offered proper incentives, like appear to offer the Bernie Ecclestones of this world then perhaps this could be significantly cleared up quicker.

Not settling...no reason to at present.

[bstar1]

Same here..well said

[Rob79]

Yes, I was thinking more about the fact that the lists are only published once a date has been set. If you are not a party to the case then you'll not be made aware and have no way of inputting into the representation despite being bound by the judgement due to follower notices

I would agree that unless you are party to the case then spotting which ones are relevant can be difficult.

I would not agree that you are bound by the judgment due to follower notices. A FN is based on HMRC's finding that the immediate and direct reason you are claiming a narrow and particular tax advantage is based on something that has been found in another case to be invalid. As has been said on these pages before, the Boyle case can be distinguished on its facts and I think would be easy to defeat if a FN was issued based on those facts.

[retrodeath]

This case is so important to HMRC that they are prepared to try every avenue in the vain hope that someone somewhere will agree with them. I suspect that the entire EBT collection hinges on this case. if they are granted the appeal is they can still issue APNs but if they are denied the right it seems to me that they could not deem the amounts to be in dispute any longer and can therefore not issue APNs. They can literally issue the APNs but they would get torn to shreds by any sane judge not least for clogging up the courts.

Or am I interpreting it incorrectly?

[jbryce]

This case is so important to HMRC that they are prepared to try every avenue in the vain hope that someone somewhere will agree with them. I suspect that the entire EBT collection hinges on this case. if they are granted the appeal is they can still issue APNs but if they are denied the right it seems to me that they could not deem the amounts to be in dispute any longer and can therefore not issue APNs. They can literally issue the APNs but they would get torn to shreds by any sane judge not least for clogging up the courts.

Or am I interpreting it incorrectly?

Oddly - just talking this through with my accountant yesterday. his view is that, for EBTs, FN will be an issue if they try and use Boyle. HMRC wanted to use Rangers.

As for APNs, they may choose to issue them, but then they *have* to go to court at some point. The Rangers case *may* suggest that they will lose a lot, clog the courts up and destroy their 80% success rate.

The settlement opportunity is an attempt by HMRC to wriggle off th hook they have put thmselves on.

[Rob79]

This case is so important to HMRC that they are prepared to try every avenue in the vain hope that someone somewhere will agree with them. I suspect that the entire EBT collection hinges on this case. if they are granted the appeal is they can still issue APNs but if they are denied the right it seems to me that they could not deem the amounts to be in dispute any longer and can therefore not issue APNs. They can literally issue the APNs but they would get torn to shreds by any sane judge not least for clogging up the courts.

Or am I interpreting it incorrectly?

The case is important. However if HMRC loses, they will seek to stick in a dark corner of "special facts" and find another to litigate. I'm aware of at least 2 other EVT/EFURB cases about to start their journey.

APN's have different criteria to meet. If a scheme has been DOTAS'd then an APN can be issued. Doesn't matter if the dispute is being continued in Court.

If no appeal is allowed, then the decision becomes final and only tax due on the terms of the decision at Upper Tier can be asked for.

There is NO appeal mechanism on APN. If you think you have a demand that does not meet the criteria then you can make a representation and it might be adjusted. If you think that the demand you get in incorrect because of a constitutional problem (i.e. directly contrary to a published decision) then your only recourse is judicial review. That can be neither quick nor cheap.

[Rob79]

Oddly - just talking this through with my accountant yesterday. his view is that, for EBTs, FN will be an issue if they try and use Boyle. HMRC wanted to use Rangers.

As for APNs, they may choose to issue them, but then they *have* to go to court at some point. The Rangers case *may* suggest that they will lose a lot, clog the courts up and destroy their 80% success rate.

The settlement opportunity is an attempt by HMRC to wriggle off th hook they have put thmselves on.

I would respectfully disagree with some of what your accountant says. That said I suspect that if you put 3 accountants in a room and asked them for an opinion, you'd get at least 5 different opinions (and a big bill).

Boyle is based on such specific facts that an FN would almost certainly be defeated. Arguably Rangers has special facts as well.

APN's have no appeal mechanism. The ONLY Court action is judicial review for HMRC acting outside its remit. HMRC's success at JR hearings is much better than 80%. the hurdle is high.

The 80% success rate is against tax avoidance cases generally. In getting to that, HMRC has deliberately cherry picked egregious cases and held back less likely cases. Eventually that percentage will fall back but probably too late for most.

Settlement opportunities for claims yet to have a final decision are common. This is part of HMRC policy and not specific to EBT.

[dangerouswhensober]

Rangers Appeal

Assuming that the CoA accepts that there are grounds for appeal, does anybody have any (informed) idea as to how long the HMRC appeal of the Rangers case to the CoA may take in practice ?

I read somewhere (possibly earlier in this or another thread) that the CoA process could take around 12 months - is that figure realistic and/or typical ?

Also, given the statement of Lin Homer on 9th July to the Treasury Select Committee (HMRC will at this stage only seek accelerated payment in cases where there has already been a tribunal decision in their favour) then this seems to indicate that APNs for users of similar EBT schemes are also 12 months away ...

[Rob79]

Assuming that the CoA accepts that there are grounds for appeal, does anybody have any (informed) idea as to how long the HMRC appeal of the Rangers case to the CoA may take in practice ?

I read somewhere (possibly earlier in this or another thread) that the CoA process could take around 12 months - is that figure realistic and/or typical ?

Also, given the statement of Lin Homer on 9th July to the Treasury Select Committee (HMRC will at this stage only seek accelerated payment in cases where there has already been a tribunal decision in their favour) then this seems to indicate that APNs for users of similar EBT schemes are also 12 months away ...

Timing depends on a number of features including the value at stake, the volume of potential schemes at stake, how many people are impacted, etc. For cases where there is some urgency, there may be a date within a couple of months of the end of the August recess. Otherwise expect 9 to 12 months.

Politics comes into this unfortunately. In this case two key events. First is that an election is due next year. Gidiot Osborne will want to show a success of his policies if only to position himself for a punt at leader eventually. Therefore a hearing and decision pre Christmas allows him to book the results. Second, HMRC may wish to have a couple of similar cases heard at lower tiers before the CofA hearing. In that case, a hearing date a bit later is indicated.

If I was running a sweepstake, I would have the appeal in Court in December and a decision in February.

One favourable feature here is that Court of Appeal will only rarely allow new legal argument to be introduced. Therefore if it is accepted that the Tribunal has analysed the facts correctly AND applied an interpretation that is not unreasonable, then the odds are in favour of taxpayer. If that happens though expect an appeal to Supreme Court.

[OneUnited]

Timing depends on a number of features including the value at stake, the volume of potential schemes at stake, how many people are impacted, etc. For cases where there is some urgency, there may be a date within a couple of months of the end of the August recess. Otherwise expect 9 to 12 months.

Politics comes into this unfortunately. In this case two key events. First is that an election is due next year. Gidiot Osborne will want to show a success of his policies if only to position himself for a punt at leader eventually. Therefore a hearing and decision pre Christmas allows him to book the results. Second, HMRC may wish to have a couple of similar cases heard at lower tiers before the CofA hearing. In that case, a hearing date a bit later is indicated.

If I was running a sweepstake, I would have the appeal in Court in December and a decision in February.

One favourable feature here is that Court of Appeal will only rarely allow new legal argument to be introduced. Therefore if it is accepted that the Tribunal has analysed the facts correctly AND applied an interpretation that is not unreasonable, then the odds are in favour of taxpayer. If that happens though expect an appeal to Supreme Court.

Is this becoming the Rob79 forum.

You seem to have so much knowledge/opinions it makes me wonder who or what you are