BN66 - JR Judgement Day

[SantaClaus]

However this Judged overlooled all your points and didnt worry too much about legalities. Maybe the next Judge will behave the same

The next time, there will be 3 judges, and not just the one who was biased because he worked on cases for HMRC.

[ASB]

'In any event, even if Mr Elvin QC had persuaded me that the arrangements worked under the DTA and the legislation then applicable, and that HMRC would inevitably have lost in any putative proceedings in respect of the arrangements, the outcome in this claim would be no different.'

Let me try and paraphrase:

If HMRC had simply explained the details of the arrangement, the outcome in this claim would be no different.

Tempted to drop her a note...

Can I make two observations?

1) You are largely right.
2) The judgement was not about the efficacy of the scheme.

To be clear. The judge is simply saying that whether the scheme works or not his judgement would be the same. In fact you may like to read carefully everything that he touched on in respect of the efficacy of the scheme. He even went as far as describing Elvins argument as formidable.

This case was never about whether the scheme worked or not. Read paragraph 1 of the judgement to ascertain what it was really about.

If the JR had been won then all this would have done in restrict HMRC actions in the event the scheme did fail.

Do not confuse the judgement in the JR with the outcome of anybody's appeal.

[Squicker]

[QUOTE=OnYourBikeGB;1067555]
Fair share of tax? What about all those huge corporations operating in the UK that pay no corporation tax?
QUOTE]

What is my fair share of tax? If I only bother to earn 35k a year it's 25%. If I go over that, it's 40%, maybe it'll be 50% soon for others. However, if I use my ISA and Pension allowances to the full plus run a healthy expenses sheet, it's going to be less. Which one of the near infinite permutations is 'my fair share'?

I've paid hundreds of K of tax in my life but being as I have private health care, have never signed on or used a single state benefit and use less road than the average person but drive a gallon guzzler, is that my fair share?

It seems to me I've been paying more than my fair share more or less my whole life, to support a system that gives less service year on year but demands more input. I know if I got the ledger out I'd have used far less than I put in. That doesn't sound fair to me.

One thing this episode has taught me is I don't work too hard. I used to contract all year without a break and be a good little worker bee. What's the point? A jealous government only takes it from me with bad legislation and illegal wars. Since this bullsh!t started I take 3 - 6 months off each year to see my son grow up, I can't put a price on that and, if it all goes wrong with our case, even the vile cretins in HMRC can't take those moments from me.

I'm not working 12 months a year to put money away only for these f@cktards to take it from me with their illegal retrospectivity. They can have what little I have, but they can't take my time, family or memories from me. Hey, I might even enjoy having to sign on once I'm bankrupted and can no longer run a business, about time I got something back from this morally objectionable state.

[Toocan]

[QUOTE=Squicker;1067689]

Fair share of tax? What about all those huge corporations operating in the UK that pay no corporation tax?
QUOTE]

What is my fair share of tax? If I only bother to earn 35k a year it's 25%. If I go over that, it's 40%, maybe it'll be 50% soon for others. However, if I use my ISA and Pension allowances to the full plus run a healthy expenses sheet, it's going to be less. Which one of the near infinite permutations is 'my fair share'?

I've paid hundreds of K of tax in my life but being as I have private health care, have never signed on or used a single state benefit and use less road than the average person but drive a gallon guzzler, is that my fair share?

It seems to me I've been paying more than my fair share more or less my whole life, to support a system that gives less service year on year but demands more input. I know if I got the ledger out I'd have used far less than I put in. That doesn't sound fair to me.

One thing this episode has taught me is I don't work too hard. I used to contract all year without a break and be a good little worker bee. What's the point? A jealous government only takes it from me with bad legislation and illegal wars. Since this bullsh!t started I take 3 - 6 months off each year to see my son grow up, I can't put a price on that and, if it all goes wrong with our case, even the vile cretins in HMRC can't take those moments from me.

I'm not working 12 months a year to put money away only for these f@cktards to take it from me with their illegal retrospectivity. They can have what little I have, but they can't take my time, family or memories from me. Hey, I might even enjoy having to sign on once I'm bankrupted and can no longer run a business, about time I got something back from this morally objectionable state.

[SantaClaus]

What is my fair share of tax? If I only bother to earn 35k a year it's 25%. If I go over that, it's 40%, maybe it'll be 50% soon for others. However, if I use my ISA and Pension allowances to the full plus run a healthy expenses sheet, it's going to be less. Which one of the near infinite permutations is 'my fair share'?

I've paid hundreds of K of tax in my life but being as I have private health care, have never signed on or used a single state benefit and use less road than the average person but drive a gallon guzzler, is that my fair share?

It seems to me I've been paying more than my fair share more or less my whole life, to support a system that gives less service year on year but demands more input. I know if I got the ledger out I'd have used far less than I put in. That doesn't sound fair to me.

One thing this episode has taught me is I don't work too hard. I used to contract all year without a break and be a good little worker bee. What's the point? A jealous government only takes it from me with bad legislation and illegal wars. Since this bullsh!t started I take 3 - 6 months off each year to see my son grow up, I can't put a price on that and, if it all goes wrong with our case, even the vile cretins in HMRC can't take those moments from me.

I'm not working 12 months a year to put money away only for these f@cktards to take it from me with their illegal retrospectivity. They can have what little I have, but they can't take my time, family or memories from me. Hey, I might even enjoy having to sign on once I'm bankrupted and can no longer run a business, about time I got something back from this morally objectionable state.

Completely agree with you Squicker. the phrase "fair share of tax" is completely ambiguous, and I bet Parker knows it.

As for me, I've moved house 4 times, so I've paid 4 lots of stamp duty.
So have I paid my fair share of tax?

What about the rich people who could afford to buy their houses for cash and avoid stamp duty completely, possible using an offshore structure or by being non-domiciled? Did they get taxed retrospectively in order to pay their fair share?

The other thing that makes me sick are the MPs claiming they are protected from criminal charges regarding their expenses because of an ancient law in 1689.

Maybe we should start digging up some ancient laws too. Let's start with how Stephen Timms lied to parliament and the Queen to get the 2008 finance bill passed. That's treason isn't it?

[Cantthinkof1]

Well said Squicker! - totally agree!!!

As has already been said on here, it all went wrong with the IR35 debarcle - another case where the Government was not content on getting a fair 'wad of money' out of everyone, but wanted to ring the cloth that bit harder. When I was paying (in total 52% in tax) for basically getting my butt out of bed everyday and travelling the length and breadth of the country, I though enough was enough and looked around for appropriate LEGAL schemes!!! Oh how stupid I was to think that England was a 'nice' place and that they would never go down the road of retrospective taxation...

To make matters worse, I am ALSO involved in the Sunday/Bradbury debarcle (see other postings on this site), where someone has ran off with £20K of my tax money, but no-one wants to know !!!

[silver_lining]

Can I make two observations?

Do not confuse the judgement in the JR with the outcome of anybody's appeal.

I believe the efficacy of the arrangement became secondary in the judgement ‘I do not attach decisive importance to the answer to that question. Nonetheless for completion I shall, as briefly as possible, deal with the issue’. I believe the main section of the summary that ultimately formed the backdrop to the judgement was paragraphs [7-17]. It is these paragraphs that demonstrate the mechanics and financials, in particular the effective tax rate. While I accept ‘Joe Public’ might struggle to get beyond this point; I don’t expect our judiciary not to interpret and apply the law of the day.

The Judge concludes that the sole purpose of entering into the arrangement is tax avoidance with no genuine commercial purpose and can therefore be correctly described as artificial. This apparently was not ‘seriously disputed’ by Elvin, I don’t think he needed to…… call it whatever one feel sits comfortably in the conscience, but interpret and apply the law of the day; that’s what we pay you to do.

I have maintained from the start that the personal moral and social principles would become the main hurdle to overcome in the Courts. If the Courts [Judges’] cannot morally, ethically and socially get beyond this point, that is to remain legally objective, while interpreting and apply the laws as they exist[ed], its game over. It was obvious this would be exploited by HMRC; nonetheless I feel everyone was somewhat surprised that this became one of the main arguments in HMRC’s defence; that is to say HMRC chose to place little weight on defending their circumvention of A1P1 by their inaction during the seven years leading up to 2008. To this end, I believe moral and social ideologically has inadvertently overshadowed the legal principles.

Is unclear from the summary even at this juncture, whether Padmore legal interpretation is applicable to the arrangement [untested by the UK courts]. This view is supported in the summary. Given this fundamental ambiguity expressed by the ruling, it follows that clarification of legislation that may not even be applicable must therefore be incorrect.

I think there is general opinion that judgement highlights so much confusion and contradiction.

‘It is also immediately plain that the tax avoidance scheme, if it worked, would be singularly attractive to any person in the position of the Claimant’
‘if it worked, would, therefore, appear to realise every taxpayer's dream of lawfully avoiding’

Really interesting and contradictory points; the Judge’s intention was to highlight the potential scope of the scheme to undermine UK tax revenues and indeed public policy, were it to gain significant traction by UK taxpayers.
Ironically; would this reason alone, not have sent shockwaves through both Parliament and HMRC such that swift and decisive action would be taken to close the arrangement immediately once it had become known? Proponents of public policy might argue that Parliament by taking no action acted negligently to members of the state by not closing down the loophole immediately; and in doing so avoid expensive litigation and directly affecting individuals’ human rights.

Parliament had clearly sent out an inconsistent message to the UK taxpayer, by on the one hand acting swiftly and decisively in Padmore and in this case failing to act for almost 8 years, coupled with enacting retrospective legislation that affected no one [Padmore]; while in this case affecting thousands of individuals immediately and who knows many in the future.

Calm blue waters…. Calm blue waters….. I feel a little better…

[northernSoul]

Parliament had clearly sent out an inconsistent message to the UK taxpayer, by on the one hand acting swiftly and decisively in Padmore and in this case failing to act for almost 8 years, coupled with enacting retrospective legislation that affected no one [Padmore];

If you think an English judge is going to set a timescale for a response on Parliament, thereby placing on it a 'duty to legislate' unheard of as far as I am aware, you have more faith in the originality and assertiveness of the judiciary than most! It would involve a massive redefinition of the constitution and I cannot see even the boldest Supreme Court judge doing that.

[centurian]

I have been in the scheme from the start - forced into it because of IR35.

Okay, I'll probably get flamed for this, but I hardly think any participants were forced into it. No-one held a gun to your head. You could have paid the same tax rates as the majority of other people earning the same amount of money.

Even accepting that MP is fully legal and declared avoidance, participating in tax avoidance is not mandatory - no-one is forced to get an ISA.

I sincerely understand your predicament - but you can't blame others for deciding to participate in the scheme.

I agree with DR in that because so many people joined the scheme we are now all being punished, that cannot be right.

Now there I agree with you 100%. With one case, they can hit 1000s because everyone in the scheme is treated the same. With IR35, each case is different. Sure, one case can set certain precedents (Dragonfly), but each case still has to be argued separately.

[centurian]

‘It is also immediately plain that the tax avoidance scheme, if it worked, would be singularly attractive to any person in the position of the Claimant’
‘if it worked, would, therefore, appear to realise every taxpayer's dream of lawfully avoiding’

Really interesting and contradictory points; the Judge’s intention was to highlight the potential scope of the scheme to undermine UK tax revenues and indeed public policy...

I would also question why it is relevant to the issue of retrospection.

No-one questions the right of parliament to close down the scheme (for the future) in the interests of taxpayers.

"If it worked", then laws would be passed outlawing it - which is exactly what happened.

I haven't read the full judgement in detail. Was that just pre-amble that judges use to pad out their judgements.