No To Retro Tax – Campaign Against Section 58 Finance Act 2008

[Fireship]

I read from this that if we lose at the FTT then thats pretty much it, we need to pay up or face the penalties. To be honest Im at the stage where I just want an outcome so I can move on. Does beg the question what if you cant, which DR answered in an earlier post that they will not enforce. BUT does that mean there wont be any penalty as its not wont pay but cant.

Think we need to see some more small print before were sure if and how it affects us. For example, if you pay and HMRC lose at appeal do you get to charge them a penalty?

Indeed, it would seem that due process has been thrown to the wind in order to make up for the incompetence of HMRC!!

To make matters worse short-sighted politicians are papering over the cracks with yet more layers of woolly legislation making an already over-complicated tax system even more uncertain! What they should be doing is stripping away the excessive and poorly implemented changes to the tax manual introduced under the last government and simplifying tax law so that everyone knows where they stand.

They should also be holding HMRC to account for their actions in this whole sorry mess however that risks making a public office look bad so better for them that they introduce legislation allowing HMRC to sweep this under the rug….

[DonkeyRhubarb]

I read from this that if we lose at the FTT then thats pretty much it, we need to pay up or face the penalties.

As PlaneSailing pointed out earlier, HMRC did give an undertaking after the High Court that they would not seek payment until the legal process had run its course.

We should be prepared to lobby MPs hard if they go back on this promise, even if the rules are changed.

[the great escape]

onwards

Latest toolkit off to Mr Afriyie, some more money into the NTRT combat fund. I re-read those real life stories and think jeziz H - I'm one of them. However what more can you do but just keep on punching.

Adjudicator one minute, HMRC bullying the next. Sometimes it seems the noise where making is being echoed back in policy changes - how does it end for HMRC if it swings our way? What does action does the adjudicator take if she finds something afoot in the submission?

Can anyone PM me the latest Mont letters? - thanks.

[Goinroamin]

MP Response

My MP is refusing to write to Lin Homer using the excuse that he is a giverment wip and cannot be seen to influence a public body. This seems strange to me given David Cameron sai he would write.

I am tempted write back stating that but just wanted check here if anyone new of any actual reason why he may be correct.

[BarneyCool]

Same here.

My MP is refusing to write to Lin Homer using the excuse that he is a giverment wip and cannot be seen to influence a public body. This seems strange to me given David Cameron sai he would write.

I am tempted write back stating that but just wanted check here if anyone new of any actual reason why he may be correct.

I received a very similar reply and came to the same conclusion as you. However I do know that the cabinet minister will not stray from the party line apparently they sign something on the way in. Probably best to get a steer from White house.
I forwarded my letter on a few weeks back and have not heard anything further.

[VictorValiant]

Response from Treasury

Received a response from the Treasury (via MP) which - for the most part uses the same tone, text and approach that has been highlighted previously. There are one or two phrases which caught my eye (may have missed references to these on this Forum so apologies if regurgitating any earlier discussions). Notably :
1) "It is not correct to say that Section 58 will lead to a large number of bankruptcies ....and that following a request by NTRT Group no more than 150 responded - equating to only 7% of the users of the scheme identified by HMRC. No evidence to suggest that views expressed by this "small proportion" can be taken as representative"
2) "Also not true that HMRC accepted large numbers of claims. I understand that - in general - users of this scheme inadequately disclosed their use of the scheme (!)...... and therefore it has been difficult for HMRC to find all users (!)"
3) "It is acknowledged that HMRC did close a very small number of enquiries - in error.......an administrative error(!)...........but this did not mean that the scheme was successful in its aim ............That the notices were issued is regrettable ..........."
4) Also "it is particularly disappointing that - without evidence - the campaign group continues to allege that HMRC lied in the Courts"
5) "The views of the scheme users on the Padmore decision appear to be based on the interpretation of an article written for a taxation publication in 1987..............the point hardly needs making that there is considerable difference between a binding decision from the Courts and a speculative paragraph or two in a journal article".
6" And finally ..............." When contrived arrangements as users of the scheme were put in place some fifteen years after Padmore, HMRC challenged those arrangements (!)"

There is obviously a good proportion of these comments which we all disagree with vehemently and I have onpassed the whole letter to NTRT. Whether the Treasury really believe this or are just being fed these "so-called" facts by HMRC is another question.

[PlaneSailing]

Tosh

Received a response from the Treasury (via MP) which - for the most part uses the same tone, text and approach that has been highlighted previously. There are one or two phrases which caught my eye (may have missed references to these on this Forum so apologies if regurgitating any earlier discussions). Notably :
1) "It is not correct to say that Section 58 will lead to a large number of bankruptcies ....and that following a request by NTRT Group no more than 150 responded - equating to only 7% of the users of the scheme identified by HMRC. No evidence to suggest that views expressed by this "small proportion" can be taken as representative"
2) "Also not true that HMRC accepted large numbers of claims. I understand that - in general - users of this scheme inadequately disclosed their use of the scheme (!)...... and therefore it has been difficult for HMRC to find all users (!)"
3) "It is acknowledged that HMRC did close a very small number of enquiries - in error.......an administrative error(!)...........but this did not mean that the scheme was successful in its aim ............That the notices were issued is regrettable ..........."
4) Also "it is particularly disappointing that - without evidence - the campaign group continues to allege that HMRC lied in the Courts"
5) "The views of the scheme users on the Padmore decision appear to be based on the interpretation of an article written for a taxation publication in 1987..............the point hardly needs making that there is considerable difference between a binding decision from the Courts and a speculative paragraph or two in a journal article".
6" And finally ..............

Obviously HMRC generated. But still avoids the question we've always wanted answering: Why,if they were so sure that the scheme didn't work, did they not go to tribunal as promised in 2007?

The unavoidable truth is that the 'speculative paragraphs' must have held a bit more weight than HMRC are letting on, otherwise why apply retrospection ? ( admittedly the discussion in Hansard is even clearer, but they have chosen not to comment on that)

And as for the bankruptcy survey, at least NTRT has done one. Can HMRC furnish us with an impact assessment to back up their claims?

Also, does the wording come across as someone who is getting a little rattled?

[reckless]

Reply from Gauke

I received a similar reply via my MP. I will pass on to Whitehouse. I agree that it sounds like a response from someone being backed into a corner, whose gold plated pension may now be in jeopardy. I would like a concise definition of 'aggressive tax avoidance' and a direction to where this is clarified in any government or HMRC literature. It is interesting to note that Gauke took 3 months to reply to my MP's letter.

Anyway, as ever, my MP remains supportive and has written to Lin Holmer. Looks like I'll be voting Labour for the first time ever come the next election.

What is really galling is the hypocrisy of Cameron et al, who having benefited from their fathers' 'efficient tax planning' enabling them to send their offspring to Eton, now lecture us on the moral obligation to pay as much tax as possible.

Viv la revolution!

[ContractIn]

Received a response from the Treasury (via MP) which - for the most part uses the same tone, text and approach that has been highlighted previously. There are one or two phrases which caught my eye (may have missed references to these on this Forum so apologies if regurgitating any earlier discussions). Notably :
1) "It is not correct to say that Section 58 will lead to a large number of bankruptcies ....and that following a request by NTRT Group no more than 150 responded - equating to only 7% of the users of the scheme identified by HMRC. No evidence to suggest that views expressed by this "small proportion" can be taken as representative"
2) "Also not true that HMRC accepted large numbers of claims. I understand that - in general - users of this scheme inadequately disclosed their use of the scheme (!)...... and therefore it has been difficult for HMRC to find all users (!)"
3) "It is acknowledged that HMRC did close a very small number of enquiries - in error.......an administrative error(!)...........but this did not mean that the scheme was successful in its aim ............That the notices were issued is regrettable ..........."
4) Also "it is particularly disappointing that - without evidence - the campaign group continues to allege that HMRC lied in the Courts"
5) "The views of the scheme users on the Padmore decision appear to be based on the interpretation of an article written for a taxation publication in 1987..............the point hardly needs making that there is considerable difference between a binding decision from the Courts and a speculative paragraph or two in a journal article".
6" And finally ..............." When contrived arrangements as users of the scheme were put in place some fifteen years after Padmore, HMRC challenged those arrangements (!)"

There is obviously a good proportion of these comments which we all disagree with vehemently and I have onpassed the whole letter to NTRT. Whether the Treasury really believe this or are just being fed these "so-called" facts by HMRC is another question.

got the same personally signed by dg. Quite a lengthy response. Don't have the letter in front of me, but does it also state that approx 400 have settled?

Will send onto NTRT

[BernardOKelly]

Memorandum of Understanding

I've just received the Montp letter about the new Memorandum of Understanding.

They say 'We are unable to provide tax advice on this matter ...'.

Why? I thought that's what they were there for.

All I want to know is, do I have to disclose anything, or can I take it that the fact that this is going on means that it's in effect already disclosed?

(Those of you with long memories may remember me. I was previously MD of Montpelier Tax Consultants in the Isle of Man. I left Montpelier over 5 years ago.)

I do not have a copy of Montpelier's letter regarding the Memorandum of Understanding but I presume that it relates to the new disclosure arrangements between the UK and the IOM of Man. As part of that agreeement, all IOM licence holders who manage "accounts" for a UK person are obliged to inform them of the existence of the Isle of Man Disclosure Facility regardless of whether they think it is relevant in any way. An IOM trust is an "account".

I am guessing that the letter came from Montpelier's trust company who like most other trust companies do not give tax advice.

In any event, if you were subject to a HMRC investigation on 6 April 2013, you are not eligible for the Disclosure Facility. I would expect that would have ruled out most recipients of the Montpelier letter.

As mentioned above, I am posting without the benefit of seeing the Montpelier letter. If you are concerned, you should take advice.