BN66 - Time to fight back (Chapter 3)

[DonkeyRhubarb]

That is not to say that Parliament may not have wanted the law to be what it now is back in 1987 – but that was not put to them 1987. Parliament were not asked to make that choice.

If you read the 1987 debate it is clear that this was an emergency measure in response to Padmore to prevent thousands of UK resident partners of offshore partnerships making a backdated claim for exemption. The reason they didn't consider trusts is probably that at the the time there wasn't any need to.

The 1987 legislation was narrowly targeted at Padmore and nothing else. For HMRC to now claim it was intended in a wider context is a complete lie.

I refer you to my earlier post where even the Government stated this in 2005:

It was intended, in the case of income tax, that the 1987 legislation should do no more than remove the exemption claimed in the Padmore case.

http://www.opsi.gov.uk/acts/acts2005...3/05en05-r.htm

[seadog]

discovery of previous evidence

The posts these last two days have drawn out a great deal of intersting background to the Padmore case, retrospection and what various members of previous governments have argued.

I hope that which ever QC is acting for Mont P has equally done his homework to show up the inconsistencies in the current arguement used by HMRC.

Thanks DR for your research it all helps to boost the strenght of the case against this retrospective legislation

[DonkeyRhubarb]

The posts these last two days have drawn out a great deal of intersting background to the Padmore case, retrospection and what various members of previous governments have argued.

I hope that which ever QC is acting for Mont P has equally done his homework to show up the inconsistencies in the current arguement used by HMRC.

Thanks DR for your research it all helps to boost the strenght of the case against this retrospective legislation

Don't worry, I'm not taking any chances.

I'm passing everything I find which could be important to WG.

[BrilloPad]

Don't worry, I'm not taking any chances.

I'm passing everything I find which could be important to WG.

I hope he registers to say thank you!

[Toocan]

If you read the 1987 debate it is clear that this was an emergency measure in response to Padmore to prevent thousands of UK resident partners of offshore partnerships making a backdated claim for exemption. The reason they didn't consider trusts is probably that at the the time there wasn't any need to.

The 1987 legislation was narrowly targeted at Padmore and nothing else. For HMRC to now claim it was intended in a wider context is a complete lie.

I refer you to my earlier post where even the Government stated this in 2005:

It was intended, in the case of income tax, that the 1987 legislation should do no more than remove the exemption claimed in the Padmore case.

http://www.opsi.gov.uk/acts/acts2005...3/05en05-r.htm

It is helpful that they later made this statement (they can hardly change history); however, my point here is that Parliament did not express an intention as far as trusts go. Therefore, HMRC cannot now claim that they were included in the measure or thought to be included.

Of course, that is what HMRC are now claiming.

[Toocan]

It was intended, in the case of income tax, that the 1987 legislation should do no more than remove the exemption claimed in the Padmore case.

http://www.opsi.gov.uk/acts/acts2005...3/05en05-r.htm

You know, if you read the information that we’ve been discussing tonight, and read the HMRC manual pages on DTA/Padmore – it is abundantly clear that the use of trusts never entered the consciousness of HMRC on this issue. And yet they were told their fix didn’t work, and they did write words to this effect in the manual. And yet took no action. I wonder if it would be possible to obtain any documentation on their considerations at that time (ie 1987 ish).

[warlord]

Suspened Notice

Hi Guys,

Great work...all looks promising!

Just had a letter from HMRC today" Thank-you for your appeals as send in from MP for years xxxx to xxxx and xxxx to xxxx. The appeals have been regsitered and Increase tax due Suspended".

Is this a standard letter that all of you are getting?

Suspeneded = Closed/stopped? - Not a great use of English?

Rgds
Warlord

[seadog]

You know, if you read the information that we’ve been discussing tonight, and read the HMRC manual pages on DTA/Padmore – it is abundantly clear that the use of trusts never entered the consciousness of HMRC on this issue. And yet they were told their fix didn’t work, and they did write words to this effect in the manual. And yet took no action. I wonder if it would be possible to obtain any documentation on their considerations at that time (ie 1987 ish).

In blog 682 Brillo quoted HMRC's response to the JR


"(b) HMRC had made both the general public and professional market well aware of its view in 1987 that “partner” and “member of a firm” included any person entitled to a share of the profits of a partnership. HMRC say that this obviously includes a life tenant of a trust where the trustee is a partner."

Strange how it was not obvious to all the cleaver tax planners at Mont P KPMG PwC and the QC's at Pump Court who no doubt advised these companies.

I presume this was the same as the obvious assumption HMRC made in 1987 when they took Padmore on and it turned out not so obvious and HMRC lost the case.

It would be intersting to know how they made the general public and the professional market aware of its view in 1987. If it was that obvious my accountants have got some serious questions to answer as to why they advised me to sign up to the scheme.

As part of the admin of the scheme in 2004 we had to send of a form to HMRC telling them we had set up the Trust with Mont P.

Knowing Mont P were relying on the DTA and having 500 other people on the schem did they not take the opportunity to let me know that the scheme did not work.

They lost another opportunity to tell me it did not work in 2005 when they opened up an enquiry into my use of the scheme and closed it saying they had finished their enquiry with no liability.

[TheGadgetMan]

They lost another opportunity to tell me it did not work in 2005 when they opened up an enquiry into my use of the scheme and closed it saying they had finished their enquiry with no liability.

So, are you saying that HMRC investigated you and your use of the MTM scheme via a formal inquiry and their response was that everything was hunky-dory and that there was no further tax to pay?...ie they accepted the workings of the MTM scheme?

If so, isn't this an admission that the scheme works for everyone and therefore, sets a precedent?

[seadog]

Hi Guys,

Great work...all looks promising!

Just had a letter from HMRC today" Thank-you for your appeals as send in from MP for years xxxx to xxxx and xxxx to xxxx. The appeals have been regsitered and Increase tax due Suspended".

Is this a standard letter that all of you are getting?

Suspeneded = Closed/stopped? - Not a great use of English?

Rgds
Warlord

I have not had a specific letter from HMRC because its all being done thorough my acountants but the appeals are registered and the tax due is suspended just as yours.