BN66 - Round 2 (Court of Appeal)

[Tax_shouldnt_be_taxing]

That bit is very bad news. Glossing over the facts will not help our cause one jot. This must surely be given the attention it requires.

BB, you might be right. But, Parker listened to all matters of technical details from both sides and then gave us 2 fingers.

So if they're not interested in the fine detail then in one way fine because I don't personally think the fine detail means much. What I do think means much and has been the cornerstone of our argument boils down to these well recited facts:

1. We told (transparently) HMRC about what we were doing
2. They knew what we were doing
3. They didn't like it and opened up enquiries
4. They made various claims as to why the scheme didn't work
5. TN63 says that it did work (contrary to HMRC claims)
6. They used a completely different legislative reason to address it
7. They applied a different retrospective outcome via BN66 than that of Padmore
8. Labour JK et al said one thing at the debating stages which conflicts with the facts
9. Abstracts such as "fair share" were used to replace legal fact
10. 7 years of incompetence by HMRC resulted in BN66.

So the above is light on detail I agree, but damn, I think it goes to the heart of the matter. Detail made no difference at the HC. Personally I'd be happy to have the detail pushed aside (since I presume the 3 Judges are fully aware of the details) and would rather focus on the 10 Commandments above in deciding if it's 'right' to use retrospection in this case as a reason for spending 7 years of tax payers money to do nowt then apply retrospection to 'fix' it rather than firing the incompetent staff who never once dealt with the matter in the way their Masters claim would be the case.

No idea how this will go, but detail didn't get us very far at the HC even with an apprent considerate Judge. I'd sooner have 3 more hostile and questioning CoA Judges wanting to look at the basics and core facts that we've all been banging on about and use common sense to discover than BN66 is a plaster to mask the total and abject failure of HMRC to do the job they so proudly state is their mission statement (e.g. 'prompt response when they discover avoidance...). Lord Almighty, you actually tell them before they require you to and they use a prompt 7 years to reverse the law as a solution.

Based on that, if the Judges want to excuse the detail, then I hope they focus on the above. After all, isn't this what it all boils down to?

Let's see and hope. "The Devil is in the Detail" it is said and the Devil has made his home there. Back to Basics is where you go when the Devil has destroyed the home in which you live and hopefully after this you can rebuild and remain.

[Tax_shouldnt_be_taxing]

Skip the Details

Just so I'm clear on this:

1. We told HMRC from day 1 what we were doing
2. We told them 4 years before we were obliged to (Disclosure Regime)
3. HMRC always knew what we were doing
4. HMRC didn't like it although it was legal
5. TN63 suggests that we were legal in 2003
6. They never claimed Padmore applied before BN66
7. They wanted us to agree to the outcome of the 4 test cases
8. We obliged
9. HMRC renaged
10. HMRC ensured the last Government changed the law retrospectively
11. Incompetence was salvaged by making 2008 look like it was 2001 (or 1987)

Or in the mantra of the Public Sector it goes:
1. Enthusiasm
2. Disillusionment
3. Panic
4. Search for Guilty
5. Punishment of the Innocent
6. Praise and Honour for the non-participants.

I hope that gives the Judges a "detail light" take on this as who needs detail when the blindingly obvious is staring you in the face?

HMRC lost the plot for 7 years and now they want us to pay their price.

[SantaClaus]

Thanks for the updates guys.

Just posted this in the comments section of that Telegraph article, exactly the type of paper that judges read, hint hint.

http://www.telegraph.co.uk/finance/p...an-rights.html

Isn't it ironic and perhaps a little unpalatable that Rabinder Singh, a "Human Rights" lawyer is fighting a case to actually deny people a human right, that of certainty of one's tax position and possessions.

HMRC, by acting in the way they have, are nothing short of guilty of entrapment.

Users of the tax scheme declared the loophole every year on their tax returns. Even though HMRC sent letters warning they did not like what was going on, they continued to let the scheme run for 7 years without bringing a single case before the Special Commissioners.

Instead of changing the law, they let the scheme run and run, knowing that the longer it ran, the deeper they could entrap users of the scheme with crippling interest payments by retrospectively changing the law at a later date. In other words, it was in HMRC's interest to do nothing, because they stood to gain more.

Users of the scheme were lulled into a false sense of security, because never before had a tax law been changed retrospectively. There were no warnings sent by HMRC that this would be done and in fact the change to the law was sneaked through Parliament by the lie that it was a "clarification" of existing law rather than retrospection.

If Montpelier lose the case, it will give HMRC carte blanche to legislate retrospectively at will. This will mean no business or person will have certainty of their tax position any more.

Now somebody tell me why so many companies are moving their offices to Switzerland or Asia?

[swede]

Thanks for the updates guys.

Just posted this in the comments section of that Telegraph article, exactly the type of paper that judges read, hint hint.

IT consultant handed £100,000 tax bill accuses HMRC of violating his human rights - Telegraph

Isn't it ironic and perhaps a little unpalatable that Rabinder Singh, a "Human Rights" lawyer is fighting a case to actually deny people a human right, that of certainty of one's tax position and possessions.

HMRC, by acting in the way they have, are nothing short of guilty of entrapment.

Users of the tax scheme declared the loophole every year on their tax returns. Even though HMRC sent letters warning they did not like what was going on, they continued to let the scheme run for 7 years without bringing a single case before the Special Commissioners.

Instead of changing the law, they let the scheme run and run, knowing that the longer it ran, the deeper they could entrap users of the scheme with crippling interest payments by retrospectively changing the law at a later date. In other words, it was in HMRC's interest to do nothing, because they stood to gain more.

Users of the scheme were lulled into a false sense of security, because never before had a tax law been changed retrospectively. There were no warnings sent by HMRC that this would be done and in fact the change to the law was sneaked through Parliament by the lie that it was a "clarification" of existing law rather than retrospection.

If Montpelier lose the case, it will give HMRC carte blanche to legislate retrospectively at will. This will mean no business or person will have certainty of their tax position any more.

Now somebody tell me why so many companies are moving their offices to Switzerland or Asia?

nice

[TheBarCapBoyz]

BB, you might be right. But, Parker listened to all matters of technical details from both sides and then gave us 2 fingers.

So if they're not interested in the fine detail then in one way fine because I don't personally think the fine detail means much. What I do think means much and has been the cornerstone of our argument boils down to these well recited facts:

1. We told (transparently) HMRC about what we were doing
2. They knew what we were doing
3. They didn't like it and opened up enquiries
4. They made various claims as to why the scheme didn't work
5. TN63 says that it did work (contrary to HMRC claims)
6. They used a completely different legislative reason to address it
7. They applied a different retrospective outcome via BN66 than that of Padmore
8. Labour JK et al said one thing at the debating stages which conflicts with the facts
9. Abstracts such as "fair share" were used to replace legal fact
10. 7 years of incompetence by HMRC resulted in BN66.

So the above is light on detail I agree, but damn, I think it goes to the heart of the matter. Detail made no difference at the HC. Personally I'd be happy to have the detail pushed aside (since I presume the 3 Judges are fully aware of the details) and would rather focus on the 10 Commandments above in deciding if it's 'right' to use retrospection in this case as a reason for spending 7 years of tax payers money to do nowt then apply retrospection to 'fix' it rather than firing the incompetent staff who never once dealt with the matter in the way their Masters claim would be the case.

No idea how this will go, but detail didn't get us very far at the HC even with an apprent considerate Judge. I'd sooner have 3 more hostile and questioning CoA Judges wanting to look at the basics and core facts that we've all been banging on about and use common sense to discover than BN66 is a plaster to mask the total and abject failure of HMRC to do the job they so proudly state is their mission statement (e.g. 'prompt response when they discover avoidance...). Lord Almighty, you actually tell them before they require you to and they use a prompt 7 years to reverse the law as a solution.

Based on that, if the Judges want to excuse the detail, then I hope they focus on the above. After all, isn't this what it all boils down to?

Let's see and hope. "The Devil is in the Detail" it is said and the Devil has made his home there. Back to Basics is where you go when the Devil has destroyed the home in which you live and hopefully after this you can rebuild and remain.

All true TSBT, but as I understand it, the whole case hinges on whether retrospection breaches A1P1. There have been challenges to retrospection before using the ECHR breach as the reason, and from those, the existing case law appears to hinge on whether retrospection could have been anticipated. Parker says yes, if for no other reason than the scheme was "artificial". It will be interesting to see if the three CoA judges agree. Do these "10 commandments" really strengthen the case that retrospection could not have been foreseen? Maybe; let's hope so.

Note that all the previous challenges to retrospection lost, so we shouldn't underestimate the difficulty in winning this one.

[javadude]

How many realised the law was going to be changed retrospectively when they signed up? None is my guess. It never occured to me that a government could or would do that.

[nick4notax]

Had I have known this could happen, I'd NEVER of joined the scheme !!

How many realised the law was going to be changed retrospectively when they signed up? None is my guess. It never occured to me that a government could or would do that.

That is absolutely true! I would never, in a million years, have guessed our government would ever try to apply tax law changes retrospectively. It beggars belief, to the common man such as I, that law makers would entertain such an unfair notion, ever. I'm continually shocked and appalled that we're in this predicament.

[BPMTopcat]

How many realised the law was going to be changed retrospectively when they signed up? None is my guess. It never occured to me that a government could or would do that.

Agreed JD. I bet a poll on who even considered, let alone anticipated retrospection would show as good as 100% didnt give it a first thought.

Thanks all for the invaluable contributions... been lurking for a while. Good luck me and all !

[loftedtag]

All true TSBT, but as I understand it, the whole case hinges on whether retrospection breaches A1P1. There have been challenges to retrospection before using the ECHR breach as the reason, and from those, the existing case law appears to hinge on whether retrospection could have been anticipated. Parker says yes, if for no other reason than the scheme was "artificial". It will be interesting to see if the three CoA judges agree. Do these "10 commandments" really strengthen the case that retrospection could not have been foreseen? Maybe; let's hope so.

Note that all the previous challenges to retrospection lost, so we shouldn't underestimate the difficulty in winning this one.

Agreed BarCapBoyz "retrospection could have been anticipated" seemed to be one of Parkers main points. I don't agree with Parker in how could we have anticipated retro since HMRC did not make us aware of Padmore until 2008, late 2008 in my case. Even then I don't remember them mentioning Padmore was retro and as a number of posters have said it might have been a retro act but was never enforced retrospectively. It would be nice to have consistancy with Padmore with no retrospective application in our case. Surely that would be equitable.

One question BarCapBoyz - what were the previous challenges to retrospection that lost? Where these taxation?

[DonkeyRhubarb]

Essential Reading

Agreed JD. I bet a poll on who even considered, let alone anticipated retrospection would show as good as 100% didnt give it a first thought.

Thanks all for the invaluable contributions... been lurking for a while. Good luck me and all !

Even had we been made aware of the 1987 legislation, which s58 supposedly "clarifies", there's nothing there to suggest anyone in the future would ever be clobbered for back tax.

On the contrary, the 1987 legislation specifically excludes that possibility.

I would encourage everyone to read the following Inland Revenue document from 1987, especially points 13 & 14 on page 5.

Legislation should not be retrospective

http://www.whatdotheyknow.com/reques...0Bill.1987.pdf