BN66 - Round 2 (Court of Appeal)

[DonkeyRhubarb]

If this were the case, does that mean only people who were not subject to the proper procedures would be able to appeal and the rest of us would not be able to appeal?

Correct, and it would be on return-by-return basis. Some people only had some of their returns handled improperly.

Bear in mind that there are no guarantees that such an appeal would be successful. HMRC regularly fail to comply with their own rules and get away with it.

I believe this is why Montp have parked this issue while they try to get the whole thing overturned.

[DonkeyRhubarb]

I'm pretty sure that any notice of 'investigation' was after the 12-months period (I'd have to check dates) - so can't I just challenge them individually right now ?

Yes but (a) you would either need to persuade Montp to represent you or hire your own legal AND (b) if you lost in the 1st Tier tribunal, HMRC would almost certainly enforce collection.

I'm not in this situation - HMRC opened enquiries on all my returns within the time limit - but if I was I'm not sure I'd stick my neck out.

Don't assume these procedural breaches will come to your rescue because HMRC are past masters at twisting their own rules to their advantage and getting away with it.

[smalldog]

Yes but (a) you would either need to persuade Montp to represent you or hire your own legal AND (b) if you lost in the 1st Tier tribunal, HMRC would almost certainly enforce collection.

I'm not in this situation - HMRC opened enquiries on all my returns within the time limit - but if I was I'm not sure I'd stick my neck out.

Don't assume these procedural breaches will come to your rescue because HMRC are past masters at twisting their own rules to their advantage and getting away with it.

which makes it farcical to even have procedures in the first place if there are no consequences for not adhering to them, what the F*** is the point? Just do what the F you want, when the F you like as there is no recourse for not following the process = throw the F'ing process out the window....

the more I learn about how HMRC operate the more I despair

[DonkeyRhubarb]

which makes it farcical to even have procedures in the first place if there are no consequences for not adhering to them, what the F*** is the point? Just do what the F you want, when the F you like as there is no recourse for not following the process = throw the F'ing process out the window....

the more I learn about how HMRC operate the more I despair

Gaines Cooper (the Seychelles guy) is a classic case in point. He operated within the 90-day residency rule, only for HMRC to come along 20 years later and reinterpret the rules. Now they are trying to clobber him for £30M in back tax.

He lost in the Court of Appeal and the case is now going to the Supreme Court.

The message this sends out is loud and clear. If you are moving abroad, cut all ties and leave blighty for good. If you are thinking of moving here, don't bother.

[bollox]

Why can't these people challenge HMRC on this basis straight away ? surely it would be a quicker route to getting the issue resolved for them?
I'm pretty sure that any notice of 'investigation' was after the 12-months period (I'd have to check dates) - so can't I just challenge them individually right now ?

I must admit, getting the feeling that there are many different routes that this can be defended on, I don't understand why we can't launch all missiles at once. Then, this first one to break through wins the war. Some of these approaches may be able to be addressed on an individual basis and wouldn't require a whole load of overhead for MP.

there is a way to find out if you've requested your details by way of a dpa request

i got a print out which detailed the enquiries and when they were opened, it also helpfully showed the last date for enquiry

Can't remember the page reference but I posted a reply to this to Santa clause a year and a bit ago, so have a search through my replies (bity busy at work or would do it myself)

mine showed that for two years I had no enquiries opened

Cheers

[smalldog]

hmm interesting

Ive just been through my mass wad of docs received post my DPA request...Found something very interesting...

They didnt open enquiries on my 3/4 and 4/5 tax years until October 2008....

On their system notes I can see all the other S9A enquiries being opened but there is a distinct lack of any notes opening these for 3/4 and 4/5...if that means they are on dodgy ground to get the money for these years as they sent me CN's for them, in the case we lose it makes a MASSIVE difference to my ability to pay..(about 50k)

There is one big note in OCtober saying open enquiries for all years 2001 - 2008 under Special comp office instructions.

[smalldog]

Discovery doesnt give them Carte Blanche

From the HMRC website, they cant do what they want:

Discovery assessments
Section 29

4.78 HMRC has the power to make ‘discovery assessments’, under TMA70/S29 (1), to prevent a loss of tax.
4.79 TMA70/S29 provides general rules for HMRC assessments to prevent any loss of tax, but the rules limit the right to make a discovery assessment for any period if a self assessment has already been made by the taxpayer for that period.
4.80 The rules that apply where a self assessment has already been made embody the principles established in case law and in particular in the case of Scorer v Olin Energy Systems Limited [58 TC p592]. In cases not involving fraud or negligence they provide that if the information ‘discovered’ was already in the officer’s possession when the self assessment became final, HMRC have no right to make a discovery assessment.
4.81 These rules ensure that a taxpayer who has made a full disclosure in the tax return has absolute finality once the time allowed for opening an enquiry has passed. This is the case even if the tax return is subsequently found to be incorrect, unless it was incorrect because of fraudulent or negligent conduct. In any case where there was incomplete disclosure or fraudulent or negligent conduct HMRC have the power to remedy any loss of tax.

[ASB]

4.81 These rules ensure that a taxpayer who has made a full disclosure in the tax return has absolute finality once the time allowed for opening an enquiry has passed. This is the case even if the tax return is subsequently found to be incorrect, unless it was incorrect because of fraudulent or negligent conduct. In any case where there was incomplete disclosure or fraudulent or negligent conduct HMRC have the power to remedy any loss of tax.

Trouble is their starting point will almost certainly be that you were negligent. You should have known that had they known the details and opened an aspect enquiry then you would have known that they would have asked some questions thus were negligent in not providing the answers to the unasked questions.

I would wish anybody challenging a discovery assessment the best of luck though. It can be done.

[normalbloke]

Trouble is their starting point will almost certainly be that you were negligent. You should have known that had they known the details and opened an aspect enquiry then you would have known that they would have asked some questions thus were negligent in not providing the answers to the unasked questions.

I would wish anybody challenging a discovery assessment the best of luck though. It can be done.

The issue is that HMRC are claiming we didn't 'fully disclose'. ie the line 'Relief claimed under Article whatever of the IOM DTA agreement etc etc' wasn't enough information to enable them to verify the return. If subsequent returns are put under investigation by SCO, this then enables them to reopen old tax returns after the one year deadline. At least that's what the gist of their letter to me said, when they reopened a year for me, 3 years on... Whether you agree with that reasoning of course is a moot point.

[smalldog]

The issue is that HMRC are claiming we didn't 'fully disclose'. ie the line 'Relief claimed under Article whatever of the IOM DTA agreement etc etc' wasn't enough information to enable them to verify the return. If subsequent returns are put under investigation by SCO, this then enables them to reopen old tax returns after the one year deadline. At least that's what the gist of their letter to me said, when they reopened a year for me, 3 years on... Whether you agree with that reasoning of course is a moot point.

Im sure they would wriggle but also found this interesting point:


The time limit for raising a discovery assessment is:

• 5 years from the normal filing date for a return in the case of incomplete disclosure, i.e. 31 January 2012 for 2005/06 returns;

• 20 years from the normal filing date for a return in the case of fraud or neglect, i.e. 31 January 2027 for 2005/06 returns.(TMA 1970 s.36)


source: Taxation web

So in my case where they opened returns in Oct 2008, they can only use discovery on tax years 2003 onwards...2001 and 2002 time limit of 5 years has elapsed. I think they would have a hard job calling it fraud or neglect. All fully disclosed even including the scheme details.

They are on very dodgy ground here, even if they can twist it to say the SA was incomplete they then have to get over the hurdle of discovery time limit....Cant honestly believe they can win both points.