TAAR and Condition D

[nikwax]

Let's say I closed down a limited company (MVL) and was intending to move abroad.

I have correspondence with a solictor demonstrating that I was in the process of acquiring property in the other country.

Then at the last minute I was offered a new contract.
- it is a non-technical role (project management) having previously worked a technical role
- I want to postpone the move until the contract is finished
- I want to set up a new limited company for the contract

There have been plenty of threads on the TAAR rules but they mostly focus on Condition C, and less so on Condition D.

Condition C

Within two years of a distribution in a liquidation, the individual carries on a trade or activity which is similar to that of the company which was liquidated.

Condition D

It is reasonable to assume that the main purpose (or one of the main purposes) of the liquidation is the avoidance, or reduction, of Income Tax.


In addition to Condition C, could it also be argued that Condition D does not apply here, as there is evidence documenting the move abroad and therefore the liquidation was not for the avoidance of income tax?

Before the pitchforks come out, let me just say that this is a real situation and not something contrived to work around the rules.

Are there any tax/accounting services out there that can carry out an assessment, as they do for IR35?

[northernladuk]

You'll just get swept up along with the masses of other people shutting them down just for tax purposes so will look like you are just taking advantage like everyone else and are gonna struggle to prove otherwise.

You moving abroad isn't enough evidence to counter the criteria IMO, particularly when you take another gig straight after. People can MVL for tax purposes and then move abroad. That can easily been seen as a reaction to the situation not the cause. The fact you want to postpone and do the gig proves that. You staying and doing the gig looks like the tax situation was the key driver to me.

IMO carry on with the process and then just do this last gig through an umbrella. I'm assuming if you have longer term plans to move then this isn't going to be a long one so go brolly to keep yourself on the right side of a slightly grey area and then get on with your move.

[Paralytic]

What NLUK said. You could probably set up another Ltd, put the last contract through that, and be on your merry way to a new life, but, at the back of your mind, you'll always be wondering if it could come back to bite you one day. Do you ever intend to return to the UK?

I'd just take the tax hit and be happy that there's no future potential issue.