Starting a new Ltd company for selling mobile apps. Will it count as phoenixing?

[jamesbrown]

I still don’t agree. Selling a product on an App Store is NOT software development.
Software development is a pre-requisite for this but so it is for almost any industry nowadays.

There is always some risk but I don’t see this as a case to be overly concerned about.
Especially as it’s not gonna make much, if anything for quite a while.

I think reasonable people can disagree about both C and D, but I am quite confident that you are wrong about how HMRC will see condition C. I am confident that they would see it as being a similar trade. This can be seen from the broad drafting and from the vague guidance given in their examples. The legislators want condition C to be interpreted broadly. The change of trade needs to be *definitive* for condition C to be clearly not met. In other words, unless you have a very good case with regard to condition D, I think you're undoubtedly at risk. At risk doesn't mean caught, it means a lot of worry and hassle in the unlikely event that it's investigated. Is it worth it? Only the OP can decide that.

[Lance]

I think reasonable people can disagree about both C and D, but I am quite confident that you are wrong about how HMRC will see condition C. I am confident that they would see it as being a similar trade. This can be seen from the broad drafting and from the vague guidance given in their examples. The legislators want condition C to be interpreted broadly. The change of trade needs to be *definitive* for condition C to be clearly not met. In other words, unless you have a very good case with regard to condition D, I think you're undoubtedly at risk. At risk doesn't mean caught, it means a lot of worry and hassle in the unlikely event that it's investigated. Is it worth it? Only the OP can decide that.

Indeed. The OP has to decide.

[eek]

I disagree with a lot of the posts above. I think HMRC would view this as being the same or a similar trade. It is software development, albeit with a different marketing mechanism. Condition C is deliberately wide and the guidance about it is deliberately vague (CTM36325). For example:

https://www.icaew.com/-/media/corpor...-guidance.ashx

CTM36325 - Company Taxation Manual - HMRC internal manual - GOV.UK

However, the two-year period within the TAAR is not symmetric in the sense that two years is enough but less than two years is not definitively "not enough" (all conditions must be met).

For example, if you were employed for a year and then made redundant, you would have a pretty reasonable case for passing condition D.

Thus, I think you would be at risk regarding C, but you might be able to make a reasonable case regarding condition D.

It is definitely not clearcut, though, so you would need to accept that risk.

+1 for me it's software development and therefore the exact same trade (the only thing that differs is marketing and sales approaches and that doesn't change the trade type at all).