BN66 - Court of Appeal and beyond

[Tax_shouldnt_be_taxing]

Wider meaning

It is interesting that BN66 makes the claim that the Padmore legislation had a wider intent (e.g. us). According to the Inland Revenue briefing notes - HMRC onlookers, please read the Finance Bill Explanatory Notes (part of the 2007 fax I mentioned), Section 62 UNITED KINGDOM MEMBERS OF PARTNERSHIPS CONTROLLED ABROAD, Part II Speaking Notes (not for circulation) Point 18 (defensive notes). So wider is in the context of how DTA's are written since few actually refer to partnerships directly so whilst the Padmore case dealt with partnerships under the UK/Jersey DTA, the wider impact of the legislation was that it would be applied to ALL DTA's not ALL classes of person as HMRC would now have us believe. Subtle difference but like all the other many contradictions of BN66 delivers a totally different outcome. If BN66 is a mere clarification, I hate to think what full blown new retrospective legislation would do!

[sjw]

I think it's fair to say that MP missed the boat on BN66 at the start. Besides, my posts are not saying that I think this can convince a court in our favour and as DR keeps saying, s58 is the law. But to let rip with some facts and figures and chronology including shady meetings on 1st Nov 2007 followed by faxes about 1987 make for a jolly riveting tale and some squirming for HMRC. Even to stand up at the TC amnd say:

"OK, so s58 is the law. So, HMRC win. Look at them grinning with pleasure. But ma lud, it may pleasure the court to hear a rather telling tale. Are you sitting comfortably? HMRC arn't. Then I'll begin. Once upon a time in November 2007... and none of us lived happily ever after. The END".

Yup i'll think of that as my family queues up for the soup kitchen - it'll make us feel a whole lot better....

[helen7]

Wow, that is naive beyond belief!!

How can you possibly say that when you have no insight into the situation others find themselves in???
I for one invested the money wisely, then 9/11 happened and a business which cost me close to $1M to set up was wiped out leaving me with losses I have never been able to recover from

You invested (risked) money you knew was not 100% yours until your tax return was accepted by HMRC.

If the business was wiped out, you didn't invest 'wisely' did you.

In hindsight, investing wisely would have been a CTD; but Montpellier and HMRC failed to mention this to us.

[Tax_shouldnt_be_taxing]

Retrospection

Upon reading some of the finer qualifiers for avoidance and evasion from our friends in HMRC, I've come across a serious conundrum. Tax evasion is illegal. It does something that breaches the law. See where I'm going? I was engaged in transparent tax avoidance yet through retrospective legislation I was doing tax evasion (allegedly). Blimey! Retrospection has just made me a tax evader. Is that possible? My CN's need re-doing. Oh, and I want to apply to the HMRC amnesty deal and get the excellent settlement rates they offer. I wonder if they'll confirm that I was engaged in tax evasion. If they won't then even now I still was not breaking the law. Catch 22! But I was breaking the law according to BN66 so I must be an evader not an avoider. HMRC didn't afford me the opportunity of the amnesty deal because I wasn't an evader before so could not get penalties and the like written off. But now I am (apparently) but I'm treated as an avoider. Yet another problem with using retrospection. It simply doesn't work.

[Fireship]

You invested (risked) money you knew was not 100% yours until your tax return was accepted by HMRC.

If the business was wiped out, you didn't invest 'wisely' did you.

In hindsight, investing wisely would have been a CTD; but Montpellier and HMRC failed to mention this to us.

Incorrect on so many levels:

The money I invested predated my involvement with MP, it was 100% mine!

Regards post MP involvement, I saw the illustrations at the original presentations and saved all monies that would be owing to HMRC should my tax return not be accepted. Once the tax return went unchallenged the money I had saved legally became mine! Which was lucky as during the post 9/11 years I needed it to prevent going bankrupt.

As for not investing “wisely”, are you telling me you could predict 9/11 and the ensuing crisis in any markets that depended on the American demographic?? Are you saying every business in the US was unwise because they had previously invested in the US?? Wow, that’s amazing perception you have!! Why then didn’t you inform everyone here about S58 before it happened?? Oh, let me see, that’s because you’re talking rubbish again!!

You’re so ill-informed it’s reminiscent of a comedy sketch, quite funny really!

[smalldog]

You invested (risked) money you knew was not 100% yours until your tax return was accepted by HMRC.

If the business was wiped out, you didn't invest 'wisely' did you.

In hindsight, investing wisely would have been a CTD; but Montpellier and HMRC failed to mention this to us.

Helen, I think this is a somewhat naive thing to say. MY personal example being divorcing some 3 years ago any my ex getting what equates to 50% of what was "saved" and invested and put aside for HMRC in the worst case. Im fortunate Ive managed to get back to the point of being able (although not wanting) to pay. I dont think its quite so black and white, if you were talking 6-12 months for this to have concluced then maybe I'd agree, but are you seriously expecting people to have put aside all the margin from using the scheme into a long term investment for what is now 10 years?

[BrilloPad]

You invested (risked) money you knew was not 100% yours until your tax return was accepted by HMRC.

If the business was wiped out, you didn't invest 'wisely' did you.

In hindsight, investing wisely would have been a CTD; but Montpellier and HMRC failed to mention this to us.

So just to confirm you invested your risked money and now have a CTD or are getting one?

[SantaClaus]

You invested (risked) money you knew was not 100% yours until your tax return was accepted by HMRC.

If the business was wiped out, you didn't invest 'wisely' did you.

In hindsight, investing wisely would have been a CTD; but Montpellier and HMRC failed to mention this to us.

Helen, I think you're very naive to think that anyone could know their financial circumstances 10 years down the line.

And I don't think anybody ever thought they would have to find 10 years worth of retrospective interest at this point either.

[Tax_shouldnt_be_taxing]

Something from 1987

If you read Hansard from 1987 there is one very important paragraph from Norman Lamont in a response to Tony Blair about what the legislation allows for. Remember, what BN66 does is supposed to be consistent with 1987 according to the brief.

"If the case goes to a higher court the proposed legislation would enable the case to be decided there on the basis of the law as it was before the legislation. That is why the legislation is framed as it is. Our altering of the law will not affect the outcome of the case and the case will still be determined by the courts."

So if consistency is used then retrospective legislation from 1987 being applied in BN66 specifically allows for the court route to continue whatever the impact of the legislation. I hope that applies when taken to the Tax Courts in our case.

So if that was the case in 1987 and is the case today what's the point of retro legislation if a court can rule anyway that gives a different affect from the legislation?

The answer is as simple as it was planned. As I've said before, 1987 was retro only to prevent people making new tax relief claims where non already existed. Where any claims existed whether in litigation or not, 1987 excluded those who had already claimed relief from being taxed retrospectively. It is there in back and white in Hansard and laboured by Blair and Lamont. So I read that as saying we can take our claims to court (the TC) and ask to be ruled upon as the law stood before BN66 - just like Parliament did in 1987. After all, it's clear that was their intent.

So if TN63, comments from Parker and the fact that HMRC ran away from the 4 test cases before BN66 came along, that should give us a fair crack at the whip to win on legal grounds as the law stood before BN66 (just as Parliament allowed for in 1987).

With that in mind, anything from HMRC demanding payment before the court case (Tax Courts) have passed judgement should be disallowed on legal grounds. Hansard clearly shows that the legislation does not affect the court process to run its course. So providing we are in the legal loop (TC appeals) I don't see how HMRC can demand anything. If HMRC are reading this, consult Hansard from 1987 (the pages you annoted) and read the exchange on this. If we have made a claim and are in the legal loop, the legislation cannot apply until the legal challenge is complete. So hands off. BTW, what Parliament intended in 1987 is clear on this point and if BN66 is only a clarification, that intent still stands.

So we should be going before the courts as though the time machine did not exist and we're back in 2007. That's a better battle ground to fight on.

[screwthis]

If you read Hansard from 1987 there is one very important paragraph from Norman Lamont in a response to Tony Blair about what the legislation allows for. Remember, what BN66 does is supposed to be consistent with 1987 according to the brief.

"If the case goes to a higher court the proposed legislation would enable the case to be decided there on the basis of the law as it was before the legislation. That is why the legislation is framed as it is. Our altering of the law will not affect the outcome of the case and the case will still be determined by the courts."

So if consistency is used then retrospective legislation from 1987 being applied in BN66 specifically allows for the court route to continue whatever the impact of the legislation. I hope that applies when taken to the Tax Courts in our case.

So if that was the case in 1987 and is the case today what's the point of retro legislation if a court can rule anyway that gives a different affect from the legislation?

The answer is as simple as it was planned. As I've said before, 1987 was retro only to prevent people making new tax relief claims where non already existed. Where any claims existed whether in litigation or not, 1987 excluded those who had already claimed relief from being taxed retrospectively. It is there in back and white in Hansard and laboured by Blair and Lamont. So I read that as saying we can take our claims to court (the TC) and ask to be ruled upon as the law stood before BN66 - just like Parliament did in 1987. After all, it's clear that was their intent.

So if TN63, comments from Parker and the fact that HMRC ran away from the 4 test cases before BN66 came along, that should give us a fair crack at the whip to win on legal grounds as the law stood before BN66 (just as Parliament allowed for in 1987).

With that in mind, anything from HMRC demanding payment before the court case (Tax Courts) have passed judgement should be disallowed on legal grounds. Hansard clearly shows that the legislation does not affect the court process to run its course. So providing we are in the legal loop (TC appeals) I don't see how HMRC can demand anything. If HMRC are reading this, consult Hansard from 1987 (the pages you annoted) and read the exchange on this. If we have made a claim and are in the legal loop, the legislation cannot apply until the legal challenge is complete. So hands off. BTW, what Parliament intended in 1987 is clear on this point and if BN66 is only a clarification, that intent still stands.

So we should be going before the courts as though the time machine did not exist and we're back in 2007. That's a better battle ground to fight on.

Do you think MP's legal team are aware of this?
If you're not involved in talks with Gittins you should be.

I want to be sure whomever represents us has all the ammunition they need.