BN66 - Time to fight back (Chapter 3)

[Emigre]

I wrote to him - just a quick email really - but he did write back:

Dear Mr Ratican

Many thanks for raising this issue.

As you will have seen from the Official Report of the debate on clause 55, we strongly opposed the retrospective nature of Clause 55 and sought to amend it accordingly.

Retrospective legislation creates uncertainty and damages business confidence, as Justine pointed out. It also denies taxpayers the opportunity to adjust their behaviour in a legitimate way to avoid an additional tax burden.

In general terms, we rely on Parliament to safeguard our liberties and, if MPs fail to do so, on the electorate to change the MPs. However, it may be possible that this provision may prove to be vulnerable to legal challenge (possibly on the grounds that the legislations denies taxpayers their reasonable expectations) but I am not in a position to advise on whether such a course of action would be successful.

I have no reason to believe that Jane Kennedy was lying in the course of this debate although I do believe that she failed to understand the significance of the retrospective nature of the provisions and the strength of opposition to it.

Given that this provision has now been enacted, we would need to look at the practicalities of repealing it once in power. We would, however, be much more mindful of the fact that legislation of this kind further undermines the attractiveness of the UK as a place to do business.

Regards
David Gauke MP

Nice work Ratican. This is far more positive response than I recall from anywhere else.

[seadog]

I wrote to him - just a quick email really - but he did write back:

Dear Mr Ratican

Many thanks for raising this issue.

As you will have seen from the Official Report of the debate on clause 55, we strongly opposed the retrospective nature of Clause 55 and sought to amend it accordingly.

Retrospective legislation creates uncertainty and damages business confidence, as Justine pointed out. It also denies taxpayers the opportunity to adjust their behaviour in a legitimate way to avoid an additional tax burden.

In general terms, we rely on Parliament to safeguard our liberties and, if MPs fail to do so, on the electorate to change the MPs. However, it may be possible that this provision may prove to be vulnerable to legal challenge (possibly on the grounds that the legislations denies taxpayers their reasonable expectations) but I am not in a position to advise on whether such a course of action would be successful.

I have no reason to believe that Jane Kennedy was lying in the course of this debate although I do believe that she failed to understand the significance of the retrospective nature of the provisions and the strength of opposition to it.

Given that this provision has now been enacted, we would need to look at the practicalities of repealing it once in power. We would, however, be much more mindful of the fact that legislation of this kind further undermines the attractiveness of the UK as a place to do business.

Regards
David Gauke MP

There is no doubt that a lot of background work is being done to keep this issue in the limelight and it is important that we do not duplicte our efforts and that we form a united front to counter the retrospective element of the Government legislation.

I think we need to see this forun as a support/action group and try to bring other scheme providers such as De Graff, KPMG, PwC, Steed etc.

We all have a common cause, not only those under enquiry from HMRC but also the Tax Planning providers who will loose all credibility and future work if this retrospective legislation becomes a standard way of dealing with legitiamete tax planning.

[BrilloPad]

ive invested all my money in shares.....ha ha ha try and get the money now IR

I believe they accept arms and legs

HTH

[TheBarCapBoyz]

There is no doubt that a lot of background work is being done to keep this issue in the limelight and it is important that we do not duplicte our efforts and that we form a united front to counter the retrospective element of the Government legislation.

I think we need to see this forun as a support/action group and try to bring other scheme providers such as De Graff, KPMG, PwC, Steed etc.

We all have a common cause, not only those under enquiry from HMRC but also the Tax Planning providers who will loose all credibility and future work if this retrospective legislation becomes a standard way of dealing with legitiamete tax planning.

I have already contacted Steed to let them know about this forum; its up to them if they want to get involved of course.

[Ratican]

united front

There is no doubt that a lot of background work is being done to keep this issue in the limelight and it is important that we do not duplicte our efforts and that we form a united front to counter the retrospective element of the Government legislation.

I think we need to see this forun as a support/action group and try to bring other scheme providers such as De Graff, KPMG, PwC, Steed etc.

We all have a common cause, not only those under enquiry from HMRC but also the Tax Planning providers who will loose all credibility and future work if this retrospective legislation becomes a standard way of dealing with legitiamete tax planning.

Definitely a good idea. What we need to think about is what kind of action we can take that would be to our benefit in countering retrospection.

[poppy01]

David Gaukes reoply interests me where he states :-

'Given that this provision has now been enacted, we would need to look at the practicalities of repealing it once in power. We would, however, be much more mindful of the fact that legislation of this kind further undermines the attractiveness of the UK as a place to do business'

Lets say all our appeals fail and we then go bankrupt, pay up or whatever. .. Then the Tories repeal it. Is it as if it had never been in effect? In which case would HMRc have to make reparations for the damage caused?

[seadog]

Why retrospection

I ahve just found this article in "Accountancy age"

http://www.accountancyage.com/accoun...rc-cracks-200m

"HMRC cracks £200m personal tax scheme

The taxman has moved swiftly in shutting down a tax avoidance scheme which could have cost the Exchequer £200m


Written by Judith Tydd

Accountancy Age, 12 Jan 2009
A £200m personal tax avoidance scheme has been uncovered by HM Revenue & Customs.

The government is set to introduce legislation in the 2009 Finance Bill effective from today to crackdown on what HMRC refers to as 'highly contrived arrangements'.

An HMRC spokesman confirmed the size of the avoidance, adding that it took just a matter of days to shut it down.

According to a statement released by HMRC, the scheme seeks to abuse tax reliefs available for employment-related liabilities incurred by employees and former employees.

A written ministerial statement will be made to Parliament tomorrow confirming the introduction of the new laws."

If they could do this within days of knowing about a scheme worth £200m why did they not use the same technique to close down the DTA loophole in 2001 when they "first knew" the scheme was being used.

Another reason to suspect we are not getting the full picture from HMRC.

[DonkeyRhubarb]

If they could do this within days of knowing about a scheme worth £200m why did they not use the same technique to close down the DTA loophole in 2001 when they "first knew" the scheme was being used.

Another reason to suspect we are not getting the full picture from HMRC.

I think you may be putting the chicken before the egg so to speak.

I bet behind the scenes HMRC were severely reprimanded for the BN66 debacle, and told never to put the Government in such a compromising position again.

As a result of BN66 (lessons learned), I would expect them to close major loopholes much faster in future.

PS. and bear in mind that the Govt will be fully aware of the embarassing revelations that will come out in the JR

[dezze]

I ahve just found this article in "Accountancy age"

http://www.accountancyage.com/accoun...rc-cracks-200m

"HMRC cracks £200m personal tax scheme

The taxman has moved swiftly in shutting down a tax avoidance scheme which could have cost the Exchequer £200m


Written by Judith Tydd

Accountancy Age, 12 Jan 2009
A £200m personal tax avoidance scheme has been uncovered by HM Revenue & Customs.

The government is set to introduce legislation in the 2009 Finance Bill effective from today to crackdown on what HMRC refers to as 'highly contrived arrangements'.

An HMRC spokesman confirmed the size of the avoidance, adding that it took just a matter of days to shut it down.

According to a statement released by HMRC, the scheme seeks to abuse tax reliefs available for employment-related liabilities incurred by employees and former employees.

A written ministerial statement will be made to Parliament tomorrow confirming the introduction of the new laws."

If they could do this within days of knowing about a scheme worth £200m why did they not use the same technique to close down the DTA loophole in 2001 when they "first knew" the scheme was being used.

Another reason to suspect we are not getting the full picture from HMRC.

Do you know how this works?

[elpinar]

been away - so late in replying

I rang my lender Abbey and asked about this and they were adamant that the offset would be netted out against the mortgage, but they said that this wasn't the case with all lenders (although that might not be correct of course could just be them queering the pitch of their competitors).

I asked the Financial Services Compensation Scheme (FSCS) lot this last May as I was worried that a fully offset mrtgae might not be netted. They replied (and i have in writing)

The position of building societies and banks is not the same under insolvency law, so that automatic set off may not apply on the insolvency of the building society, whereas it would be automatic on the insolvency of a bank.

However, contractual set off may apply or could be ordered by the court


so abbey are right - as they are now a bank - but if (like me ) you are with a building society it May or MAY NOT apply - i tried ringing my b/s to ask - and it seemed that it depended on who answered the phone as to what reply you got !!